Greece is one of the last remaining countries in Europe to offer golden visas.
The controversial ‘residency by investment’ schemes allow wealthy foreigners to ‘buy’ the right to stay in a country long term.
Concerns over security and inflation have led many EU nations to abolish golden visas in recent years.
Greece launched its programme in 2013 during what became the country’s 10-year financial crisis. The visas were intended to bring money into the country during its housing market collapse.
The visa allows third-country nationals who purchase properties of a certain value to become temporary residents.
Initially, a real estate investment of €250,000 or more could gain you a five-year residence permit in Greece, which could be converted into citizenship after seven years.
But last year, concerns over inflated house prices led the government to increase the threshold to €500,000 in some parts of Athens, Mykonos, Santorini and Thessaloniki.
Now, that could rise yet further to €800,000, according to Prime Minister Kyriakos Mitsotakis.
Although Greece’s golden visa can also be acquired through a €400,000 investment in government or private bonds and shares, purchasing a property is the most popular route to residency by investment.
The new upper investment threshold for properties would apply in areas facing housing shortages and pressure on rental prices, Mitsotakis said in Parliament last week.
Rents have increased by 40 per cent since 2018, he acknowledged, and around 7 per cent of real estate sales in Greece in recent years was related to the golden visa.
“The increases in sales prices have reached the point where permanent residents with their current economic conditions cannot purchase a home to meet their housing needs,” says Themistoklis Bakas, CEO of the nationwide E-Real Estates Network.
“Specifically, from 2017 to the second quarter of 2023, an increase of 71 per cent was recorded in the sale prices of newly built houses in Attica, simultaneously dragging down the sale prices of older properties.”
In parts of the country where housing is not under pressure, the threshold could remain at €250,000, Mitsotakis added.
The goal of the higher threshold is to bring more money into Greece while reducing the number of golden visas issued.
As well as pushing up rent and real estate prices, the residency by investment scheme has been accused of straining local resources, such as medical care – especially in places where properties are rented out as holiday lets via platforms like Airbnb.
Golden visa property owners who plan to rent out their homes in Greece could therefore also be forced to lease long term in future.
Some campaigners want the government to go a step further, however, and remove real estate from golden visa investment options.
However, the programme brings significant revenue to the Greek state – €4.3 billion between 2021 and 2023.
While the government aims to control foreign ownership of property in Greece with the golden visa investment increase, the announcement may have the opposite effect.
“The moment when the government announced the possible increase in the investment limit [in 2023], the demand of real estate investors to buy real estate aiming for the golden visa tripled,” says Bakas
“In particular, direct foreign investments in the real estate sector reached €2 billion in 2022.”
As such, Bakas describes the golden visa investment increases as a ‘one-way street’, especially in areas of high demand.
Instead, he would like to see the programme used as a “development tool in the regions of Greece that need investment and new jobs.”
“For example, in Thessaly, which has suffered huge damage from the flood [of 2023], the investment limit should be set at €200,000 for the next year,” he says, “and in order to avoid a problem with the housing stock, it should only apply to newly built properties up to 5 years old.”
Similarly, the threshold could be reduced for those who invest in small villages with the aim of tourism development or the creation of student or affordable housing.
“The golden visa investment programme is not a bad programme, we just don’t operate it properly,” Bakas says.
