The relevant economy and finance minister on Tuesday said the government is examining the prospect of making the e-payment of home rent mandatory, in a bid to further curb tax evasion and avoidance in the residential real estate sector.
“We can all agree, I believe, that the average monthly rent in the country is not 255 euros. It’s clear that the real figures are different, and that we need tools to accurately depict reality,” Economy Minister Kyriakos Pierrakakis said, in addressing a real estate conference in the Greek capital.
At the same time, in a nod to the center-right government’s “free market” wing, Pierrakakis, among the more prominent and popular ministers in the Mitsotakis Cabinet, said there was no proposal on the table to cap rent hikes.
Economy & Finance Minister Kyriakos Pierrakakis, left.
Although “rent regulation” has never gained traction in Greece, where home ownership is high by EU standards, a series of factors over the past five years or so have caused a housing shortage in the greater Athens-Piraeus agglomeration, where nearly half of the country’s 11 million residents reside. The shortage, by extension, has caused rent prices to soar. A handful of other urban areas in Greece are also experiencing a similar phenomenon, while touristy areas are prohibitive.
Among others, new building construction in the country sharply declined during a decade-long economic crisis, meaning few new units were built. Even before the “memorandum era” ended in 2018, another two factors came into play, affecting the “demand side”: the impressive increase in properties listed on Airbnb-type platforms and the “Golden Visa” initiative granting third country nationals temporary residence visas in Greece for real estate purchases over a certain amount. Consecutive annual increases in tourist arrivals have also buoyed the holiday residence market, with raw materials and labor costs also surging.
The post-Covid “disruption” also increased demand for housing, which in the Greek capital is mostly apartment units.
In touching on a possible change in the tax rate on incomes derived from leased properties, Pierrakakis merely pointed “down the road” to the annual early September state-of-the-economy address given by the prime minister at the Thessaloniki International Fair.
