Two years ago, I was looking to buy a new apartment near my parents' home in Athens with my wife. In my area, two major construction companies build apartments. At the time, I was somewhat naïve and had no prior experience in apartment hunting. I visited one of these companies' offices, but finding anyone to talk to was tricky. After my third visit, I finally spoke with the owner's son, who I didn't think was competent.
When our conversation began, I mentioned I was looking for a two-bedroom apartment. Without knowing anything about me, he said, "Listen, give me 100,000 euros in cash, and we'll write down that you bought the apartment for 300,000 euros instead of 400,000 euros. I will still pay 400,000 euros, of course." But I think he wanted 100.000 euros in a paper bag for me to secure the apartment. I was flabbergasted. I was like, what is this idiot talking about? Did he confuse me for someone else? Then he called the bank and sent me to speak to a supervisor to discuss things further. My wife was speechless at this Latin American way of doing business, but I was like, let's play alone to see how the system works.
We went to the bank, and this supervisor looked like she just come back from the bouzoukia very unprofessional attire, and she was head of the bank and couldn't speak English. She talked to me about how I wire money and get a loan and gave me a piece of paper describing the procedure in 3 languages: Greek, Chinese & Russian.
I went back to this owner's son to talk about what other apartments he had available, and he said, "Ah yes, I have the penthouse for 800.000 euros, and you can give me in the paper bag 300.000 euros."
I smirked and replied, "Let me think about it." We left with my wife, had a coffee, and laughed about the ordeal.
This is not signs of healthy growth nor would act as an accelerator for brain gain!! Apartments in Athens end up being more expensive from overseas cities that the wage average is 5 times higher.
I fully agree that Airnb and similar short term rentals platfoms have significantly contributed together with Golden Visa in the current terrible hoising crisis .
It is worrying that people now in Greece are trying to evade taxation and regulations and are renting to clients bypassing airbn . They advertise on private chat groups or FB or other .
I dont know how upated is the Airbn platform to reflect legal changes in Greece and whether the newest regulations will be compulsory to be verified as complied with by the Platform .
i.e a dwelling cannnot be offered on Airbn if it does not provide proof of compliance
The uncontrolled rise of Airbnb-style apartments in the center of Athens is not *the* problem. But it is *a* big problem, especially when coupled with years of Golden Visa purchases from foreigners that took many houses off the market and also led to the skyrocketing of prices (over and above local GR standards). The combination of these two factors have skewed an already problematic housing market and have made it more difficult for locals to either buy or rent.
You are right to point out that the number of unavailable dwellings in Athens is very large. This is also something I mention in the article. This is a very big reason why the strain is felt so deeply by the locals BUT that has now become a structural problem that will not be solved any time soon. The vast majority of unavailable houses that are closed are trapped in a legal limbo zone that will take decades to unravel. That's a byzantine task to undertake in and of its own not just for a government, but also the public services, the courts and the people whose real estate property is caught in the crossfire.
Until then, we need to look at the present situation on how to move the needle and identify the key reasons affecting affordable housing today.
Interesting insight about the listings per host ratio. I think it is pretty common as a user if I book an apartment through Airbnb in Athens, I usually have a look on the host's profile and they have a dozen other apartments in the Aegean islands.
Like they say for the inequitable rise of private equity funds, maybe we need more players in the game to share the pie. Of course following the regulations and best practices not only set by the government but also local communities
I think the core of the problem is not airbnb per se ( it is, but it isn’t ). The core problem is how concentrated Greece is in Athens. Much like London is the whole of England, economically and … well in every way.
Greece should aim to spread in other cities, and give them more “power” to attract companies and investment. It will help spread the costs as well. Much like Germany where no one city is the center of everything. Countries that have one or two big cities monopolising everything ( Barcelona, Lisbon, Rome, Paris, London ) have this issue in those cities.
I do not know if genuine efforts like that are underway, I hope there are.
Very well said, could not agree more. Athens hyper-concentration is a key problem, especially when we lack proper transport infrastructure to allow for more people commuting on a daily basis (without a car).
Sadly, infrastructure wasn't made when it should have, 10-20-30 years ago. But better late than ever. I do hope right steps will be taken, to connect the mainland with proper train connections. Landscape doesn't help, but having lived in Norway, I've seen everything is possible nowadays.
It would give a huge boost to the country if other mainland cities get ministries and key industries to decongest Athens.
Again, I am not following the politics and developments, so no idea if that is already happening or not.
Great article. I'm colour blind (achromatopsia is such a cool word, btw) so the density map was a challenge but I get it. I go to Athens probably once/ twice a year and I've noticed the key boxes. It's good revenue for some locals but inflationary for everyone :-(
Thanks Steve! As I write in the piece, the problem is not Airbnb (or its siblings, like Blueground) per se. It is the lack of a solid framework around them, which is impacting the larger cross-section of society today. There are some efforts underway, but much more needs to be done.
I acknowledge the same data that you do, but I see a completely different picture.
- The vast majority of empty dwellings that are unavailable (mostly because of legal and bureaucratic reasons) cannot be magically reintroduced into the economy. It will take years if not decades for a good portion of them to be 'unlocked'. They keep coming up as a number, but it is a number that will remain idle for quite some time. This is a very big problem, but the needle has only changed marginally over the past few years.
- The long-term/short-term letting ratio is clearly changing for the worse, with many properties that were for years in the long-term letting category no longer available primarily because these flats are turned into Airbnb-style apartments OR because they are purchased by foreigners (majority of which are tied to the Golden Visa problem).
- The uncontrolled Airbnb expansion and the Golden Visa craziness are not the only problems affecting Greece's housing crisis. They did however skew the market and influence the current reality heavily, with both real estate offices and letting agencies placing all of their bets on them as they made them a ton of money during the boom of the past 5-6 years.
Again, the key is not to ban anything; it is creating the proper framework for short-term rentals to operate. The government has already taken some measures towards the right direction. But more needs to be done.
"Allowing people to make some extra cash with a spare room should be welcomed."
This is how AirBnb started but it is not how it is now.
No regulation (at all) until it's too late.
Story of our times.
Thanks for the post, really comprehensive and detailed :)
I don't believe that leaders/municipalities etc of the city embrace the last quote. Am I missing some evidence that proves the opposite?
'I want to live in a city that is habitable for its citizens, an Athens that I am proud of.'
Two years ago, I was looking to buy a new apartment near my parents' home in Athens with my wife. In my area, two major construction companies build apartments. At the time, I was somewhat naïve and had no prior experience in apartment hunting. I visited one of these companies' offices, but finding anyone to talk to was tricky. After my third visit, I finally spoke with the owner's son, who I didn't think was competent.
When our conversation began, I mentioned I was looking for a two-bedroom apartment. Without knowing anything about me, he said, "Listen, give me 100,000 euros in cash, and we'll write down that you bought the apartment for 300,000 euros instead of 400,000 euros. I will still pay 400,000 euros, of course." But I think he wanted 100.000 euros in a paper bag for me to secure the apartment. I was flabbergasted. I was like, what is this idiot talking about? Did he confuse me for someone else? Then he called the bank and sent me to speak to a supervisor to discuss things further. My wife was speechless at this Latin American way of doing business, but I was like, let's play alone to see how the system works.
We went to the bank, and this supervisor looked like she just come back from the bouzoukia very unprofessional attire, and she was head of the bank and couldn't speak English. She talked to me about how I wire money and get a loan and gave me a piece of paper describing the procedure in 3 languages: Greek, Chinese & Russian.
I went back to this owner's son to talk about what other apartments he had available, and he said, "Ah yes, I have the penthouse for 800.000 euros, and you can give me in the paper bag 300.000 euros."
I smirked and replied, "Let me think about it." We left with my wife, had a coffee, and laughed about the ordeal.
This is not signs of healthy growth nor would act as an accelerator for brain gain!! Apartments in Athens end up being more expensive from overseas cities that the wage average is 5 times higher.
I fully agree that Airnb and similar short term rentals platfoms have significantly contributed together with Golden Visa in the current terrible hoising crisis .
It is worrying that people now in Greece are trying to evade taxation and regulations and are renting to clients bypassing airbn . They advertise on private chat groups or FB or other .
I dont know how upated is the Airbn platform to reflect legal changes in Greece and whether the newest regulations will be compulsory to be verified as complied with by the Platform .
i.e a dwelling cannnot be offered on Airbn if it does not provide proof of compliance
Not sure how Airbnb's is really the problem. There are c. 250k "closed" houses in Athens. The Airbnb houses are c.15k.
250k closed houses is insane. It contributes significantly to the lack of supply of houses.
The uncontrolled rise of Airbnb-style apartments in the center of Athens is not *the* problem. But it is *a* big problem, especially when coupled with years of Golden Visa purchases from foreigners that took many houses off the market and also led to the skyrocketing of prices (over and above local GR standards). The combination of these two factors have skewed an already problematic housing market and have made it more difficult for locals to either buy or rent.
You are right to point out that the number of unavailable dwellings in Athens is very large. This is also something I mention in the article. This is a very big reason why the strain is felt so deeply by the locals BUT that has now become a structural problem that will not be solved any time soon. The vast majority of unavailable houses that are closed are trapped in a legal limbo zone that will take decades to unravel. That's a byzantine task to undertake in and of its own not just for a government, but also the public services, the courts and the people whose real estate property is caught in the crossfire.
Until then, we need to look at the present situation on how to move the needle and identify the key reasons affecting affordable housing today.
Interesting insight about the listings per host ratio. I think it is pretty common as a user if I book an apartment through Airbnb in Athens, I usually have a look on the host's profile and they have a dozen other apartments in the Aegean islands.
Like they say for the inequitable rise of private equity funds, maybe we need more players in the game to share the pie. Of course following the regulations and best practices not only set by the government but also local communities
I'm generally against regulations of this sort. But as they say all government policies are bad but some are worse than others.
I wrote a note about the issue a while back. https://substack.com/@mdnadimahmed888222/note/c-83989886?r=o2bbq
The situation in Greece is complicated by the fact that there is a free movement deal with the EU.
Great piece. Massive theme.
Thanks Philo! Glad you enjoyed.
Very good article.
I think the core of the problem is not airbnb per se ( it is, but it isn’t ). The core problem is how concentrated Greece is in Athens. Much like London is the whole of England, economically and … well in every way.
Greece should aim to spread in other cities, and give them more “power” to attract companies and investment. It will help spread the costs as well. Much like Germany where no one city is the center of everything. Countries that have one or two big cities monopolising everything ( Barcelona, Lisbon, Rome, Paris, London ) have this issue in those cities.
I do not know if genuine efforts like that are underway, I hope there are.
Very well said, could not agree more. Athens hyper-concentration is a key problem, especially when we lack proper transport infrastructure to allow for more people commuting on a daily basis (without a car).
Exactly.
Sadly, infrastructure wasn't made when it should have, 10-20-30 years ago. But better late than ever. I do hope right steps will be taken, to connect the mainland with proper train connections. Landscape doesn't help, but having lived in Norway, I've seen everything is possible nowadays.
It would give a huge boost to the country if other mainland cities get ministries and key industries to decongest Athens.
Again, I am not following the politics and developments, so no idea if that is already happening or not.
Great article. I'm colour blind (achromatopsia is such a cool word, btw) so the density map was a challenge but I get it. I go to Athens probably once/ twice a year and I've noticed the key boxes. It's good revenue for some locals but inflationary for everyone :-(
Thanks Steve! As I write in the piece, the problem is not Airbnb (or its siblings, like Blueground) per se. It is the lack of a solid framework around them, which is impacting the larger cross-section of society today. There are some efforts underway, but much more needs to be done.
The problem is, that it enables greed and speculation, both within and without.
Achromatopsia. A for the negation. Chroma is colour. Opsis for sight.
Therefore, Achromatopsia is the state of not seeing colour!
What a word.
I know. Wonderful 👍🏾
Θ΄αποτελούσε καταπληκτική βοήθεια, εάν μεταφραζόταν!
:-)
Λέτε, ε; Θα το σκεφτώ. :)
Νομίζω πάντως είναι αρκετά εύκολο να μεταφραστεί με Google Translate.
https://support.google.com/translate/answer/2534559
AI can do it in seconds.
https://silbadeepdives.substack.com/p/c6cc9a2b-4521-41e6-a1b7-a42f948692b6
I have seen this argument a lot lately. I understand it but personally do not agree.
To begin with, this has nothing to do with survivorship bias (https://en.wikipedia.org/wiki/Survivorship_bias) and data that has survived thus far.
I acknowledge the same data that you do, but I see a completely different picture.
- The vast majority of empty dwellings that are unavailable (mostly because of legal and bureaucratic reasons) cannot be magically reintroduced into the economy. It will take years if not decades for a good portion of them to be 'unlocked'. They keep coming up as a number, but it is a number that will remain idle for quite some time. This is a very big problem, but the needle has only changed marginally over the past few years.
- The long-term/short-term letting ratio is clearly changing for the worse, with many properties that were for years in the long-term letting category no longer available primarily because these flats are turned into Airbnb-style apartments OR because they are purchased by foreigners (majority of which are tied to the Golden Visa problem).
- The uncontrolled Airbnb expansion and the Golden Visa craziness are not the only problems affecting Greece's housing crisis. They did however skew the market and influence the current reality heavily, with both real estate offices and letting agencies placing all of their bets on them as they made them a ton of money during the boom of the past 5-6 years.
Again, the key is not to ban anything; it is creating the proper framework for short-term rentals to operate. The government has already taken some measures towards the right direction. But more needs to be done.