In the Antheon area, in Thessaloniki, on tree trunks, passers-by read an original advertisement. A couple of young children are looking for a house of a few square meters to rent, but the prices are astronomical… The children study and work at the same time, the money they have is not small, 600 euros for 60 sq.m. However, they have not been able to find what they are looking for.
“We are looking for a nice house in this neighborhood. We are a couple of 23 and 27 years old, studying and working. We are looking for a house of 60 sq.m. with a price of up to 600 euros, bright and furnished. If you know anything, we would be very happy if you could take us to this number…”. The ad is accompanied by a beautiful drawing. A bright little house, with many windows, chimneys and flowers.
The original advertisement of a couple on a tree trunk in the Antheon area, in Thessaloniki.
The cute ad captures, in the optimistic way of its editors, a problem that is constantly escalating. The desperation of many young couples, families, students, and even single people looking for a decent house of a few square meters at a reasonable price. They search rental websites, social media, and even door-to-door on city streets, but demand is high and supply is low.
“If we are talking about opening closed houses, incentives should also be given to Airbnb owners who failed and want to put their house up for rent again” says Mr. Paradias of POMIDA
“The offer would be greater, and the prices more competitive, if the closed houses were opened” says in “Vima” n Anna Mokakoucertified real estate appraiser and real estate agent. Indeed, if each of us does a little research in the apartment building where he lives, he will probably count one to three closed apartments. Apartments that could come on the market, drop prices and provide a solution to those who are searching without success.
They need motivation
However, as real estate professionals point out, in order to open the foreclosed houses, the owners should be given incentives.
“No one keeps a house closed by stubbornness” says the president of the Panhellenic Federation of Property Owners (POMIDA), Paradise Army. And he adds: “The existing situation discourages the owners of the houses from renting them out. The problems are many, starting from the systematic poor paying tenants, the lack of money for renovation, and reaching the high taxation”.
But how many closed houses are there? There are no official figures, only estimates from ELSTAT and the Land Registry. And they estimate the closed houses at around 770,000, i.e. for 10% – 15% of the total. However, as those involved in real estate point out, most of them are closed houses in the villages or on the islands, and far fewer of them are in the urban fabric. In Athens and Piraeus the closed apartments exceed 420,000, mainly in old districts. Of these, it is unknown how many belong to private individuals and how many belong to the State and also to which State bodies.
A story from Patisia
Behind every closed house, there is a special story. Residents of the Ano Patision area who spoke to “Vima” easily recall stories that led to the abandonment and deterioration of apartments or single-family homes. Among them that of two sisters who grew up near the bridge of the church of Agia Barbara. Giannis and George grew up in a beautiful detached house with a garden. At that time, Patisia was considered one of the best areas of Athens and there were still neighborhoods in the center of the city. The years passed and everyone lived their own lives.
They grew up, made their own family. Now, one lives in Chalandri and the other in Glyfada. For many years the house in Patisia was a point of reference, a meeting point. Every Sunday the two brothers returned to their ancestral home, their mother cooked, just like then, and they ate together with their wives and children. The cousins were playing in the garden, just like they did when they were little. As the children grew up, the visits to Patisia became less frequent, everyone had their obligations. When the parents passed away, they left the house to their two children, and that’s where the problems started.
How many stories have we heard, about siblings who fought over the inheritance and never spoke again… Today the house in Patisia languishes empty and closed. Its shutters are permanently closed. The garden is overgrown. George sometimes passes by the house where he grew up… he sees it and memories are awakened. The house in Patisia is one of the thousands of closed houses in Athens.
Mrs. Mokakou maintains that there are moves that would facilitate the opening of closed houses. Among them, he proposes programs for owners who do not have the money to renovate their homes, functionally and energy-wise, based on the specifications of the European Union. Most homes were acquired during the foreclosure era (up to 2006) and have approximately 15 years of idleness making them unsuitable for rental.
“The “Renovate-Rent” program has already been announced, but it has a low subsidy, i.e. it gives up to 6,000 euros to each house that will be renovated” she says herself. “However, if the owner cannot afford to put extra money into the renovation, the amount is small and not enough for a serious renovation to get the house to rent and attract a better quality of tenants. Because there are areas where the big problem for landlords is the inconsistency of tenants”. Another proposal has to do with tax incentives, with many even calling for an income tax exemption for homeowners to make their homes available for rent.
The student housing
On the other hand, the students’ parents put their hands deep in their pockets. At the moment, nationwide, houses from 25 sq.m. up to 60 sq.m. that cost between 200 and 500 euros are only 5,500, while the new entrants are 68,000. Many of these houses are located in areas of low demand for students, they are poorly maintained or underground and semi-underground, a decent student house costs more than 500 euros, with the most expensive rents being in Attica in areas close to universities.
At the same time, the new complaint of a teacher (this time in Rhodes) who went so far as to sleep in his car, refusing to pay 400 euros for a studio, as his salary does not exceed 800 euros, is coming to light. “I am a teacher of Gennadi Primary School since last year and this year too, I am looking for a studio apartment to rent in Gennadi for up to 300 euros per month. It’s a shame to sleep in the car because they ask me 400 euros for a studio and I can’t pay that much for a house” the teacher himself wrote indignantly the previous days.
Funds, Golden Visa and Airbnb
But the problem of the roof has many different sides. Many of the foreign residents who bought houses in Greece to get the golden visa do not take advantage of them. In addition, Greek or international funds are gradually putting houses on the market precisely so as not to drop prices suddenly. Finally, many of the foreclosed homes are homes that were turned into Airbnbs that didn’t go well.
Of the closed apartments in Athens, it is unknown how many belong to private individuals and how many belong to the State and to which of its agencies. There are also those for which there is a discrepancy of heirs.
About 30% of Airbnbs fail either because they are in the wrong area or because the owners have no experience in this type of business. For example, as Mr. Paradias says, “an Airbnb in Peristeri is occupied 32 days a year. Accordingly, a house in the Zografou area, if rented as a student residence, will yield much higher profits compared to an Airbnb in the same area. Therefore, if we are talking about opening the closed houses, incentives should also be given to Airbnb owners who failed and want to re-rent their house.
The housing problem is a problem that concerns everyone, since, as people in the market say, Greeks grow up with the phrase always in their minds “to put a tile over our head”! The housing crisis, soaring rents and lack of housing supply is an issue on which announcements are expected to be made by the Prime Minister at the TIF. As it is said, in the economic staff they are preparing the final touches on a package of interventions aimed at increasing the number of houses offered for rent and, through this, lowering prices, so as to make the acquisition of housing affordable for households.
The fear of the tax authorities and tenants who do not pay
“I keep my house closed because…”
But what are the real reasons why thousands of homes remain closed? Obviously, each owner has their own personal reasons. However, as market experts explain, there are five main reasons why property owners find it unprofitable to put them on the market.
1. I keep my house closed because I want to sell it in the long term.
One of the main reasons why the owners of the houses do not put them on the market for rent is because in the long term they want to make them available for sale, therefore it is important for them that there are no damages that will lower the value of the property.
2. I keep my house locked because I don’t trust tenants.
The second reason for the phenomenon, as brokers say, is directly linked to the first. Landlords are afraid that tenants will return the houses in bad condition, poorly maintained, and this will lower the value of the property in a future sale. In addition, in addition to the poor maintenance of houses that some landlords perceive to be done by tenants, landlords fear defaulters, and especially systematic defaulters.
“There are not a few owners of old properties who do not have the money to renovate them both functionally and energetically”
3. I keep my house locked because I’m waiting for my children to come in.
Often a house remains closed because the owners reserve it for their children and try to protect it from potential damage.
4. I keep my house closed because I have no money to repair it.
For a house to be rented at a competitive price and to have claims of finding a good tenant, it should be a house renovated and in excellent condition. However, many owners in the current period of increased financial obligations and financial anxiety do not have the money to renovate their homes, both functionally and energy-wise (based on the European Union’s energy requirements). There may be programs to subsidize renovations, however, as many owners claim, the amounts are not enough.
5. I keep my house closed because if I rent it, the tax authorities will take everything from me.
Finally, many think of high taxation. Especially for owners who own more than one property, those who we once called “income earners”, but have now foreclosed on their homes. The owners are asked to give the tax authorities a large percentage that can reach up to 40%, which is why they are asking as an incentive to be exempt from income tax for at least three years for those who have closed houses from 1/1/2023.
The numbers
- 10% – 15% of all the houses in the country are closed.
- 75% since 2017, the amounts required to rent student housing in cities such as Athens or Patras have increased.
- 200 to 500 euros houses from 25 sq.m to 60 sq.m are rented nationwide in areas of moderate or low demand.
- 60%-70% of the average monthly salary reaches the cost of housing in many households today.
- 76,9% of renters, according to recent surveys, if they pay their own housing costs, cut back on essentials or borrow from third parties.
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