Greece’s housing crisis is being driven less by Airbnb and more by millions of vacant homes that remain off the market, according to a new study by the State Budget Office in Parliament, which says inactive properties may explain up to 26.7% of the rise in real house prices since 2018.

For years, rising rents and property prices in Greece have been blamed largely on short-term rentals, the Golden Visa investment residency programme and limited construction activity. However, the new study directly challenges that view.

Citing recent data, the office says the total impact of short-term rentals on rents does not exceed 1.8%, a figure far lower than the one often cited in public debate. Instead, it argues that the deeper cause of the housing crisis lies in the millions of homes that exist but remain vacant and unavailable for rent or sale.

The study also refers to a recent analysis by the International Monetary Fund, which found that Greece faces a problem of housing distribution and use, not an actual shortage of housing stock. In other words, the country has homes, but too many of them are absent from the market. As a result, the supply of properties actually available to households is shrinking, while prices continue to rise.

The country with the most vacant homes and the highest rent rises

Between 2018 and 2025, house prices rose by 95.7% in Athens and by 94% in Thessaloniki. Over the same period, more than 2.2 million homes remained vacant, representing 34.5% of Greece’s total housing stock.

This is the starting point of the State Budget Office’s analysis, which argues that the issue is not a lack of homes but the fact that a large share of existing properties is not available on the market.

The finding points to one of the central contradictions of the Greek property market. Greece has one of the highest vacancy rates in Europe, while also recording some of the steepest increases in rents and house prices.

More homes, fewer properties on the market

Census data underline the scale of the problem. Between 2011 and 2021, Greece’s total housing stock increased by 3.5%. Yet the number of homes available for long-term rent fell by 10.4%, while the number of homes listed for sale dropped by 33.1%.

At the same time, the number of “inactive” vacant homes, meaning those not offered for rent or sale, rose by 6.1%, from 1.71 million to 1.81 million properties.

The result is that while the overall number of homes in Greece increased, the number of homes available to residents on the market decreased. According to the study, this trend is one of the main reasons housing pressure has intensified, despite the fact that the country’s housing stock has grown.

Inheritance disputes, renovation costs and “ghost” properties

The study links a significant part of the price increase after 2018 to the limited use of Greece’s existing housing stock.

The analysis shows that many homes exist on paper but remain effectively frozen. Some are caught up in inheritance disputes, ownership conflicts, unclear property rights or legal cases. Others remain empty because of high transaction costs, expensive renovation work, poor energy efficiency or location in areas where demand is weak.

As a result, the actual supply of housing remains low, even though Greece has a large stock of residential property. The researchers estimate that the limited use of existing homes may explain a sizeable part of the rise in house prices between 2018 and 2025.

Construction, the Golden Visa and foreign capital

The study does not dismiss the role of construction. It notes that building activity remains far below pre-crisis levels. The gross value added of the construction sector fell from almost €18 billion in 2007 to under €5 billion during the decade of the financial crisis, while residential investment now accounts for just 3.1% of GDP, compared with more than 10% before the crisis.

However, the researchers say this is only part of the explanation. Greece’s total housing stock has not disappeared. It remains particularly large and is expected to return to pre-crisis levels by the end of the decade.

The analysis also examines the role of foreign capital in the property market. Foreign direct investment in real estate has exceeded €800 million a year since 2019. However, much of this money has gone into holiday homes, properties linked to the Golden Visa and other investment categories that do not necessarily increase the supply of housing available to Greek households and long-term renters.

Airbnb’s role is smaller than often claimed

The study’s position on short-term rentals is especially significant, given the central role Airbnb has played in public debate over Greece’s housing crisis.

The researchers do not accept the argument that Airbnb is the main driver of rising rents and house prices. Citing a recent study, they note that properties used exclusively for short-term rentals account for just 0.4% of Greece’s total housing stock and only 1.1% of vacant homes.

The same study estimates that the overall impact of short-term rentals on rents is no higher than 1.8%. It also finds no strong correlation between rent increases and the rise in short-term rental listings when other market factors are taken into account.

The authors add that many owners use their properties only occasionally and would not necessarily offer them for long-term rent even if Airbnb did not exist.

This does not mean short-term rentals have no effect. The study acknowledges that in high-demand areas, including central Athens, Thessaloniki and popular tourist destinations, short-term lets can reduce available supply and add pressure on prices. However, it concludes that the root cause of the housing crisis lies in the widespread failure to bring existing homes back into use, rather than in short-term rentals alone.

Vacant homes may explain up to 26.7% of price rises

To measure the impact of inactive properties, the study uses a macroeconomic model adapted to Greek data.

The results show that the reduced use of Greece’s housing stock could account for up to 19.1% of the rise in real house prices. Under a stricter scenario, which includes a larger number of homes withdrawn from the long-term market, the effect could reach 26.7%.

The authors stress that off-market properties are not the only reason prices have increased. Other factors include rising construction costs, land values, financing conditions, foreign investment, market expectations and local demand pressures.

Prices could fall by up to 24.6% if vacant homes return to the market

The study’s most striking conclusion concerns what could happen if part of Greece’s inactive housing stock returned to the market.

According to its simulations, if the rate of vacant and inactive homes gradually fell to 2001 levels over a period of about six years, real house prices could decline by between 15.5% and 24.6%.

Put simply, the largest stock of “new” housing currently available in Greece is not on construction sites, but behind closed doors, in properties that remain unused and off the market.

The State Budget Office concludes that addressing the housing crisis will require a combination of measures aimed at increasing the actual availability of homes. Its central finding is that Greece’s property problem is not primarily quantitative but functional. The country does not lack homes. It lacks homes that are genuinely available.

As long as millions of properties remain trapped in inheritance disputes, legal problems, high renovation costs or areas away from concentrated demand, the housing crisis will continue to put pressure on households and renters, despite Greece having one of the largest stocks of vacant homes in Europe.