New Greek Tourism Bill Excludes Thousands of Properties from Operating as Short-term Rentals

Properties not classified as primary residences, including warehouses, basements, and former industrial or craft buildings, are set to be removed from short-term rental platforms, according to a new bill submitted by the Tourism Ministry to Parliament on Wednesday.

According to the bill, these specific spaces (although they may have been renovated with the aim of hosting tourists and visitors) are excluded from the market due to a requirement that they be classified as primary residences or have undergone proper licensing before July 28, 2011, as stipulated by Greek law 4495/2017.

In particular, the new regulation removes the following categories of properties from short-term rental platforms (such as Airbnb, Expedia, etc.):

– Properties that were once old storage spaces or basements and have since been renovated for residential use.
– Properties that have not been officially officially recognized as primary residences or did not comply with regulations before July 28, 2011, as required by law.
– Spaces in former industrial or professional areas that have been converted into tourist accommodations, even if they meet other quality standards.

According to industry insiders, these property owners now find themselves excluded from the short-term rental market, with their investments in these spaces potentially becoming unprofitable for tourism purposes. The new regulation is said to directly impact owners who have invested substantial amounts to upgrade these properties, raising concerns about the long-term viability of their investments.

Strict requirements for short-term rental properties in Greece

The bill also introduces stringent specifications for properties that can still be used for short-term rentals. These include the necessity for properties to have natural lighting, proper ventilation, civil liability insurance, electrical safety certificates, and firefighting infrastructure. Additionally, the premises must have undergone health procedures, including certified pest control and disinfection, and be equipped with basic first aid supplies.

Enhanced inspections and sanctions

The bill also enforces a strict framework for inspections and penalties for properties in Greece listed on short-term rental platforms, such as Airbnb.

Under the new provisions, inspections will be carried out by mixed teams of Tourism Ministry employees and Greece’s Independent Public Revenue Authority (AADE) inspectors. Property managers will be notified at least ten days in advance of any inspections, giving them time to prepare the necessary documentation. If deemed necessary, the Greek police may assist with the inspection process.

Inspectors will carry official identity cards and written mandates that include the details of both the property owners/managers and the inspectors.

Property owners/managers must fully cooperate with inspections and provide the necessary certificates for electrical safety, civil liability insurance, and sanitary measures like pest control and disinfection.

€5,000 fine for non-compliance

Failure to comply with the law will result in a hefty 5,000-euro administrative fine, with even harsher penalties for repeat offenders.

The fine applies in cases where inspectors are denied entry to the property, the property does not meet the required specifications (such as lack of natural lighting or ventilation), or the owner fails to fulfill the necessary obligations.

Property owners have 15 calendar days to bring their properties into compliance after a violation is detected. If the same violation occurs within a year, the fine will be doubled; subsequent violations will lead to fines increasing fourfold.

Greek property owners react to new bill

The Panhellenic Federation of Property Owners (POMIDA) has already expressed strong opposition to the bill, particularly criticizing the retroactive application of these new specifications.

They argue that this will render many properties, which have been operating on rental platforms for years and have contributed to tourism development, effectively “useless”. A particularly contentious aspect is the provision that excludes properties that have been recently converted into tourist accommodations, including areas that have been redeveloped in the center of Athens and other cities, which have contributed to the revitalization of previously degraded areas.

Property managers threaten legal action and strikes

Members of the Greek Property Managers Association (PASIDA) have announced plans to take legal action in an effort to have the law declared unconstitutional.

Their initial move will be a large-scale information campaign across all media outlets (both in Greece and abroad), as well as on social media platforms.

The first step in their protest will be not accepting reservations for February. If the bill is passed, they have threatened to extend this refusal of bookings through August (month of high tourism season) as well.

It should be mentioned that tax revenue from short-term rentals in Greece has seen a dramatic rise in recent years, with revenues increasing more than tenfold since 2017, according to Greece’s Independent Authority for Public Revenue (AADE).

The head of the authority, Giorgos Pitsilis, had stated that revenues from short-term rentals were expected to reach 830 million euros in 2024.