HomeAway

The short-term property rental market has become a trap for the majority of owners who entered into it due to the problems the pandemic created to the sector.

Looking up the address 38 Falirou Street in Koukaki, central Athens, on Google Maps, you will find a photo of a car repair shop. If you actually go to the spot, however, it will be a letdown if you had been hoping to have your car repaired, and Google Maps won't be to blame, as a new enterprise has only just begun operating at this address in the last few weeks.

The major increase in short-term holiday rentals in Athens and other large cities in Greece, and the rise in the popularity of city breaks are highlighted by Bank of Greece data on travelers and their expenditure in the first quarter of the year.

Just 5.3 percent of the total stock of apartments for rent in Attica are currently bound for short-term leasing, numbering below 12,000 across the capital, according to data presented on Thursday by the Sharing Economy Association (SODIA).

The Athens housing market remains under the strong influence of short-term rentals, as 70 percent of buying interest in small residential units concerns properties destined to be upgraded and leased through websites such as Airbnb and HomeAway. As a result property prices posted mild growth in the first quarter of 2019, according to an analysis by Geoaxis chartered surveyors.

The absence of an adequate and integrated legal framework on short-term property rentals through websites such as Airbnb and HomeAway is leading to individual apartment blocks coming up with their own regulations and solutions for any problems that emerge.

Property prices in Greece recorded their biggest rise of the last decade last year, as the RE/MAX estate agency network's annual survey points to an average increase of 7.3 percent from 2017, when annual growth had only come to 1 percent.

Tax inspectors are now focusing on individual taxpayers, who until recently were not on the authorities' radar as interest was focused on large-scale tax evasion by businesses. However, the major rise of short-term property rentals on platforms such as Airbnb and HomeAway is leading to individuals cropping up in the monitoring schedule too.

The constant increase in Attica's hotel room supply combined with the drop-off in the soaring growth in demand and the market entry of thousands of apartments for short-term lets have already started to drive occupancy rates and room prices at the capital's hotels toward a decline.
The current prospects for both supply and demand are pointing to a further gap in the near future.

The government is considering introducing restrictions on the utilization of properties advertised on short-term rental platforms such as Airbnb and HomeAway for holiday accommodation. The restrictions will be imposed on individual owners as well as investors and professional agents who benefit from the new market.