The housing crisis The Commission is also aware of the fact that, in the case of Greece, there is a need for a new approach to the problem. International Monetary Fund, recording an explosive mix of rising prices, high rents and serious structural weaknesses in the housing market.
As he points out, real estate prices and rents are rising at a much faster rate than household incomes, as the high demand, from both Greek and foreign investors, meets limited available supply, old and energy-efficient building stock and significant market malfunctions.
At the same time, thousands of dwellings remain vacant or undervalued, while short-term leases, high renovation costs and barriers to building activity further intensify pressure. Within this environment, the IMF stresses the need for a more aggressive and coordinated housing policy, with emphasis on use of inactive housing reserve, the strengthening social housing and reducing barriers to the construction of new dwellings.
Prices rise
According to the report, housing prices have increased at a much faster rate than income after 2017, while rising interest rates, low savings and bank lending restrictions make access to ownership increasingly difficult. At the same time, rents are now moving upwards, even more burdening households, in a country where – as OECD research records – two out of three citizens say they are concerned about whether they will be able to find or maintain a decent residence.
The «Greek paradox»
The IMF stands particularly in one «Greek paradox» the housing crisis: although more than 60% of households have a privately owned home without a housing loan, the housing burden remains extremely high. Greece is among the countries with the largest housing reserve per inhabitant in Europe, despite population decline, However, 35% of the dwellings are not used as a main residence, while about one third of them – 12%-13% of the total stock – remain vacant.
As of 2017 the market has steadily recovered, with prices increasing cumulatively by around 85%, compared to an increase of just 47% in disposable income per capita
Housing prices in Greece have been rising in recent years at a much faster rate than income, in a development that the IMF has mainly attributed to a strong «recovery phenomenon» following the collapse of the real estate market during the debt crisis.
Prices recorded a drop of over 40% in 2008-2016. Since then, however, the market has steadily recovered, with prices increasing cumulatively by about 85%, compared with an increase of just 47% in disposable income per inhabitant. The IMF estimates that market overestimation is moving around 10%, while Spitogatos platform data show large geographical disparities, with significantly higher prices in Attica, Thessaloniki and tourist destinations in relation to the rest of the country.
The price and income ratio left from 1998 to 2025. On the right are price differences per square meter in various regions of Greece.
Up to 24 years for the purchase deposit
Access to ownership is becoming increasingly difficult mainly because the high lending costs and low savings of households, notes the IMF. Explosive rise in real estate prices combined with increased interest rates on housing loans has significantly exacerbated the housing accessibility index, which measures whether an average household can buy a typical home without lacking basic consumer needs.
With an annual savings rate of 10%, a household would take about 24 years, or 14 years at best, to raise the necessary money for the prepayment of home purchase
According to the estimates of the report, given that banks usually require that the loan is not more than 30% of the income and that the loan covers 70%-80% of the property's value, the average Greek household was left in 2024 by about 7% to 17% of the income required to be able to receive a housing loan.
But even where the income is sufficient for the approval of a loan, the amount of the deposit required remains a huge obstacle. The IMF estimates that, with an annual savings rate of 10%, a household would take about 24 years, or 14 years at best, to raise the necessary money for the prepayment of home purchase..
Rents may have been late to follow the explosive rise in real estate prices, but they now show increasingly strong signs of pressure, the IMF warns. The increase in rent significantly accelerated after the pandemic, touching 10% in 2025.
On the left is the development in rent prices from 2011 to 2025. Right, prices per square meter in various regions of the country.
According to the IMF the percentage of disposable income directed at housing spending was over time particularly high in the country and increased even more during the debt crisis. Although the situation has improved somewhat with the recovery of the economy, this progress now seems to have «freeze», while for the lower income layers the image is deteriorating again.
The high housing costs are also linked to increased dues. According to EU-SILC survey data, 41.8% of households show delays in housing-related payments
In order to cope with increased housing costs, more and more young people remain for a longer time at home. At the same time, many households turn to smaller homes.
At the same time, high housing costs are also associated with increased dues. According to EU-SILC research data, 41.8% of households have delays in housing-related payments, while a large number of citizens state that it is difficult to heat or cool their homes sufficiently, which also highlights the dimension of energy poverty in the Greek housing crisis.
Property alone is no longer enough to protect households from the housing crisis
According to the investigation, based on data from 2021-2025, the probability of housing over-charge for low-paid borrowers or tenants exceeds 90% when for higher income layers it is limited to about one third. Similarly, a low income tenant has four times as much chance of being in a state of over-charge as a more affluent tenant. But even among those with no loan, low incomes sharply increase economic pressure, showing – according to the IMF – that ownership alone is no longer enough to protect households from the housing crisis.
According to the report, 2011-2021 The percentage of households with real estate but with limited current income increased significantly – the so-called phenomenon «rich in assets but poor in income». This means that even housing owners without a housing loan still face significant economic pressures in relation to their income, especially when they do not have sufficient liquidity or borrowing capacity. The IMF identifies this contradiction as one of its key elements «Greek housing paradox».
The energy factor
The Fund attributes an important part of the high housing cost to the oldness of the Greek building stock, which appears significantly less energy efficient than other countries in Southern Europe. Even households without rent or housing loan are burdened with high fixed costs, such as energy bills, maintenance costs and property taxes.
Only 7.4% of Greek housing is classified in the energy category B or higher, resulting in Greek houses consuming about 65% more energy per square meter than their respective Portuguese properties
According to the report, the energy costs of Greek households are higher in purchasing power terms than in countries with similar climate conditions, such as Spain and Portugal. The problem, however, does not seem to be related as much to energy prices as to low energy efficiency of housing. Only 7.4% of Greek housing is classified in the energy category B or higher, resulting in Greek houses consuming about 65% more energy per square meter than their respective Portuguese properties, where investments in energy upgrades were 2.5 times higher.
At the same time, despite recent reductions in the ENFIA, repeated property taxes remain relatively high in Greece and continue to burden the total housing costs of owners. Nevertheless, the report notes that recent tax exemptions for certain low income households may partially reduce this pressure.
On the left, energy consumption intensity in the domestic sector. Right the percentage of people living in housing whose energy efficiency has improved over the last 5 years, 2023.
Airbnb
The IMF analysis concludes that short-term leases of the Airbnb type have intensified pressure on housing supply in certain areas of the country. Using a special regional database combining elements from Spitogatos, INSETE and ELSTAT platforms, the report finds that as the intensity of short-term lease increases, the price of real estate increases – especially in areas where ownership rates are low and tenants dominate. A similar picture is recorded in rents, although the effect appears milder.
However, the Fund notes that the overall impact of short-term leases on the accessibility of housing cannot be fully assessed without taking into account their contribution to economic activity and tourism income.
Proposals
1. Utilization of vacant dwellings
According to the IMF, the fastest and most effective solution to alleviate the housing crisis is to restore empty housing to the market. International experience shows that successful strategies combine motivation, unincentive and institutional support.
First step, according to the Fund, is the expansion and better targeting of renovation programmes to address liquidity problems that prevent many owners from exploiting their properties. Indeed, linking subsidies to energy upgrades could offer a double benefit: reducing energy costs for households and increasing the available housing supply.
The IMF also recommends the imposition of tax incentives for vacant dwellings, such as special taxes or additional charges on underutilised properties in high demand areas, on country standards such as France and Ireland.
2. Long term leases
The IMF estimates that the long-term lease market can only become more attractive if it reduces the «Risk premium» which, as many owners consider, accompanies tenants and perennial leases. According to an Alpha Bank survey in 2026, owners prefer short-term leases not only due to higher returns, but also because they offer greater flexibility – as they can use the property when they wish – and because they consider that they have less risk than long-term tenants.
In this context, the Fund considers that tax incentives are moving in the right direction to convert properties from short-term lease or inactivity to long-term rental.
3 Increase in the supply of new housing
The IMF estimates that increasing the supply of new housing requires a substantial change in the productivity of the construction industry and the functioning of the market. As noted in the report, better allocation of resources and strengthening of the most productive enterprises is required, through policies facilitating either restructuring or the departure of unsustainable companies – so-called «Zombie companies» – and reduce barriers to business development and merger.
4. Affordable and social housing
The IMF welcomes the government's initiatives to strengthen affordable and social housing, but stresses that these interventions should be further strengthened. It considers the project to exploit and renovate public property in cooperation with the private sector, which, as it notes, can be a crucial step towards the creation of an organised social housing market in Greece.
The new building framework that motivates manufacturers and property investors to have part of their new development in a social or economic affordable home is also positively assessed.
5. Redesign of support measures
The IMF warns that housing demand support measures should become more targeted in order to avoid further rising prices and strengthening social inequalities. As noted in the report, when housing supply remains limited and cannot respond quickly to demand, horizontal subsidies and general support measures tend ultimately to benefit property owners and sellers more, rather than substantially improve housing accessibility.
Horizontal subsidies and generalised support measures, when housing supply remains limited, tend to ultimately benefit property owners and sellers more than substantially improve housing accessibility
According to the Fund, the connection of rent refunds to the actual amount of the monthly rent could increase transparency in the rent market, but this would entail higher budgetary costs in the future.
At the same time, the IMF calls on the government to review the effectiveness of tax incentives such as VAT exemption on new buildings. As noted, there is a risk of such interventions primarily favouring more affluent households or large real estate companies, with no substantial benefit to housing accessibility. In this case, the Fund proposes either their gradual abolition or their reorientation towards the renovation and energy upgrading of the existing housing reserve.
6. Policy coordination
The IMF underlines that addressing the housing crisis cannot only be achieved by fragmentary interventions in the real estate market, but requires much closer coordination of policies in areas such as labour, energy, banking and regional development. According to the report, improving housing accessibility requires tackling deeper structural problems affecting income, cost of living and concentration of demand in specific areas.
Conclusions
According to the conclusions of the IMF report, the problem of housing accessibility in Greece has evolved into a self-sustaining vicious cycle, where the economic vulnerability of households, the aging and energy-inefficient building stock and demographic and social changes reinforce each other.
The Fund estimates that Greece does not face a classical shortage of housing as much as a problem of misdistribution and exploitation of the existing housing reserve. The structural malfunctions, geographical imbalances, concentrated demand and weaknesses of the driver market, as noted, in severe mismatches between supply and real housing needs.
In the financial sector, it is necessary to relax credit restrictions, particularly through faster clearing of old ones. «red» loans, strengthening competition between banks and developing specialised financial products for renovations and energy upgrades of housing.
