Tax Incentives in Greece: A Driver for Investment and a Factor Behind Rising Prices

Greece offers a range of tax programs to attract foreign investors — including the non-dom regime and pensioner incentives. These measures have brought in fresh capital but have also contributed to a surge in real estate prices, according to Ekathimerini. As a result, the government is now tightening regulations in the property market.

The Non-Dom Regime and Pensioner Incentives

The non-dom program allows foreign nationals to transfer their tax residency to Greece by investing at least €500,000 over three years in real estate, stocks, or bonds. Participants gain residency rights and are exempt from standard tax rates, instead paying a flat annual tax of €100,000 on their global income. The scheme is valid for up to 15 years.

Foreign pensioners enjoy a 7% flat tax for 10 years if they move to Greece, reside there for at least 183 days per year, have not been a Greek tax resident for five of the last six years, and come from a country with a double taxation agreement with Greece.

Real Estate and Golden Visa

Greece's Golden Visa program still allows foreigners to obtain residency (without tax perks). Since 2024, the minimum investment has risen to €800,000 in key areas such as Athens, Thessaloniki, Mykonos, and Santorini. In less sought-after regions and for commercial property conversions, the threshold is €400,000 or €250,000 respectively.

In 2024, foreign investment through this program reached €2.75 billion — up 28.9% year-on-year. Golden visa applications rose 11.3%, totaling 9,381.

This growth has fueled demand, especially in central city areas and tourist islands. According to Global Property Guide, average property prices rose by 56% between 2019 and 2024, placing Greece 18th globally for price growth. However, over the past 15 years, growth was modest (4.22%) due to steep declines between 2010 and 2015, particularly in Athens and Thessaloniki.

Price Growth and Affordability

In 2024:

Athens: €2,250/m² (+10.5%)

Thessaloniki: €2,107/m² (+10.7%)

Athens Riviera: €3,900/m², reaching €10,000 in Glyfada and Vouliagmeni

As of February 2025, the national average was €2,543/m² (+1.64% YoY). Rental rates also rose to €10.05/m² (+3.5%).

The European Central Bank has deemed Greek real estate overvalued by 20–30%, though systemic risk remains low thanks to macroprudential safeguards. However, analysts warn that affordability is eroding and speculative foreign demand is increasing.

New Market Restrictions

In response, Greece is introducing new controls:

As of January 1, 2025, a ban on new short-term rentals in Athens districts like Kolonaki, Koukaki, Pangrati, and Exarchia

From October 2025, rental properties must meet technical standards: natural light, ventilation, windows, and air conditioning

Short-term rental tax hikes: €1.5 → €8/day in high season; €0.5 → €2 in low season

Golden Visa conditions are also tightening with higher investment minimums and fewer eligible properties. Experts anticipate property prices will rise 3–5% in 2025, with potential slowdown in 2026 due to regulatory pressure and limited new construction.

Urban Planning and Overbuilding Issues

Urban planning in tourist regions remains fragmented. A study in Technical Annals emphasizes the lack of coordination and political support, weakening the balance between competitiveness, sustainability, and environmental protection.

Tourism infrastructure is also under strain. Santorini’s mayor Nikos Zorzos warned that 20% of the island is already built up and “not a single new hotel room should be allowed”.