Greece: rent has become a death sentence for the family budget

IN Greece rent is rising faster than wages, and there is almost no social housing. Housing crisis becomes one of the main reasons for political anger of the population.

Housing costs in Greece and Europe is turning from a domestic problem into a political one. When rent grows faster than wages, the voter is angry not at the statistics, but at his own wallet.

The housing crisis has become one of the main reasons for irritation of Europeans. In large cities, it is becoming increasingly difficult for people to buy an apartment or rent housing at a price that still leaves money for living. Tourismshort-term rentals, migration, lack of construction and weak social policies have converged at one point. As usual, those who don’t buy houses as investment souvenirs have suffered.

According to Κέντρο Φιλελεύθερων Μελετών (Center for Liberal Studies, ΚΕΦΙΜ)V 2025 Greece records second-largest annual rent increase in the world EU: +10.1%. It was only higher Croatia. On average EU-27 housing prices increased by 5.5%and rent – at 3.2%.

For Athens the numbers look particularly painful. Renting a one-bedroom apartment can already eat up about 70% average monthly salary, and with two bedrooms – almost the entire average salary. That is, formally a person works, but practically he serves someone else’s property. A very modern form of serfdom, only with an online contract and deposit.

Why Greece became a bad example

The problem is not only that housing is becoming more expensive. The problem is that wages in Greece remain too low for European rental prices. The real estate market is already living at almost European prices, and the incomes of many workers still resemble a post-crisis economy with a facelift.

The situation is getting worse short term rentaltourist demand, foreign home buying and weak construction of affordable apartments. In popular areas, housing is increasingly seen not as a place to live, but as an asset. For an investor, this is income. For a local resident, it means eviction from his own urban reality.

Against this background, talk about one-time benefits looks poor. Rental assistance may temporarily ease the pain, but it does not solve the main problem: there are no more apartments, prices do not fall, and the landlord understands perfectly well that the state is simply helping the tenant pay the inflated price longer.

Social housing: something that almost doesn’t exist

In Europe they are increasingly talking about social housing as the only serious tool against the crisis. According to Housing EuropeGreece is an exception: the country has virtually no full-fledged social rental real estate sector, other than limited pilot projects.

For comparison: In a number of European countries and cities, social or affordable housing accounts for a significant market share. Vein has long been cited as an example of a city where public and non-profit housing has a real impact on prices. In Greece, the state has for decades relied on property and benefits, but not on creating a large stock of affordable rentals.

This is why the Greek market turned out to be so vulnerable. When almost all housing is dependent on the private market, the price rises to whatever the market can squeeze out. And if the state does not build an alternative, it then only wonders why young families cannot live separately, and voters begin to vote with anger.

Why rent control doesn’t help?

Many governments trying to fight the crisis through rent restrictions. On paper this sounds nice: prohibit surge growth, protect tenants, punish greed. In practice, everything is more complicated. The Economist notes that strict rent control can reduce supply: owners begin to sell apartments or leave the long-term rental market.

IN Catalonia restrictions helped some existing tenants, but the number of new contracts decreased. IN the Netherlands Some owners, unable to increase rent, prefer to sell apartments. It turns out to be a typical political trick: the government declares protection for residents, and the market responds by reducing supply. And again, the one who is looking for an apartment becomes the last one.

This does not mean that the market should be left without rules. But rules without construction are an attempt to treat a fracture with a band-aid. Nice, fast, useless.

Europe is facing a shortage of houses

The main reason for the crisis is simple and unpleasant: there is not enough housing where people want and can live. IN SpainAccording to Bank of Spain estimates, the housing shortage amounts to hundreds of thousands of apartments. Government Pedro Sanchez has already pushed ahead with a plan to increase spending on social housing to around 7 billion euros in four years, but construction is hampered by land, permits, regions, bureaucracy and a shortage of workers. Even here people managed to create a crisis faster than at home.

Similar problems are visible in other countries. IN Germany construction does not meet the stated needs, in France there is also a shortage of new houses, and in southern Europe some of the empty housing is in places where people simply don’t want to live: in small towns, villages or in poor condition.

The crisis is also aggravated by tourism. Apartments go to short-term rentals, neighborhoods turn into hotels with no reception, and locals discover that their city has become too expensive precisely because someone liked it for the weekend.

What might work

The solution is frustratingly simple: need more affordable housing. Not only benefits, not only restrictions, not only press conferences with smart people. Needed social apartments, council housing, faster permitting, tax incentives for long-term rentals, restrictions on over-tourist exploitation of housing stock and real investment in construction.

Benefits without construction often only increase prices. Rent control without new supply shrinks the market. And empty statements about “affordable housing” don’t give people the keys. Surprisingly, it’s not possible to live in a press release yet.

Editorial comment

The housing crisis in Greece is not a whim of youth or “inability to save.” This is the result of a failed policy, where the market was allowed to lead the way, and the state was left somewhere behind with a brochure on family support.

If rent eats up half, two-thirds, or almost the entire salary, a person stops believing in beautiful stories about economic growth. He sees something else: there is work, but there is almost no life after paying for housing. This is how an everyday problem turns into political anger, which spills over onto the current government.

Greece does not need cosmetics, but a competent housing policy: the construction of affordable housing, social rent, control of short-term rentals and a normal urban strategy. Otherwise, the anger of the population will grow along with the rent. And then the authorities will again be surprised where the “radical sentiments”, pogroms and riots came from. From the receipts, gentlemen.

For rent, for utilities, for food checks…

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