Greece is introducing a major incentive to encourage real estate investors to re-enter the long-term rental market. A new tax reform, expected to take effect in November 2025, offers a three-year income tax exemption for landlords who lease properties that have been vacant for at least 36 months.
Tax-Free Rental Income for Three Years
Under the new framework, rental income from eligible properties will be fully tax-free for 36 months, provided leases are signed by December 31, 2026.
This initiative is part of the Finance Ministry’s plan to increase the supply of long-term rental housing and reduce dependence on short-term platforms like Airbnb.
Expanded Eligibility and Flexibility
The reform extends the tax exemption to larger properties rented to families with multiple children:
- 140 sqm for families with three children
- 160 sqm for four children
- 180 sqm for five or more, plus 20 sqm for each additional child
The measure also introduces more flexibility for investors. Shorter lease durations—at least six months—are now allowed for public sector tenants such as doctors, teachers, and uniformed officers.
Landlords retain the exemption even if a tenant leaves early, as long as a new tenant is secured within three months.
Eligibility Criteria
To qualify, properties must meet one of the following:
- Declared vacant on the E2 form for three consecutive years
- Registered as short-term rentals for at least one year before conversion to a long-term lease
Properties must be leased by December 31, 2026 to secure the benefit.
Important: Listing a property on a short-term rental platform, or failing to find a tenant within three months, will terminate the exemption and all subsequent income will be taxed at standard rates.
Strategic Opportunity for Investors
For investors with idle or underutilized properties, this reform offers a unique opportunity to reposition assets toward the long-term market, generating steady, tax-free income while supporting the government’s housing supply objectives.
Government Response to the Housing Crisis
Greece is facing a growing housing crisis, prompting authorities to examine short-term rental regulations. The government is considering measures similar to those implemented in other European cities such as Barcelona, Paris, Berlin, and Lisbon, where regulations, taxes, and strict controls have limited the proliferation of short-term rental platforms.
Greece’s Minister of National Economy and Finance, Kyriakos Pierrakakis, emphasized that while no final decisions have been made, the government is closely monitoring developments and may introduce stricter regulations or tax measures if necessary to increase housing availability.
The three-year tax exemption provides a timely opportunity for investors to capitalize on long-term rentals, aligning with both market demand and government policy priorities.
Source: Kathimerini.com
