2024-03-27 14:01:24
Another year of “frantic” activity by foreign investors interested in obtaining a “golden visa” is predicted by real estate market players, as the new changes announced within the week by the economic staff are expected to sharply limit the attractiveness of the Greek program for granting residence permits through the acquisition of property. In this way, the government estimates that the upward pressure exerted on housing prices due to foreign buying interest will be reduced. On the other hand, it is also clear that capital inflows from abroad for the purchase of real estate, which last year were estimated at around 2 billion euros from the “golden visa” program alone, will plummet.
Based on what was announced, the minimum amount of investment in real estate, in order for the interested investor to secure a residence permit, will be increased to 800,000 euros in the Regions of Attica and Thessaloniki, as well as in all islands with a population of 3,100 or more. That is, all the popular tourist destinations, such as Crete, Rhodes, Mykonos, Corfu, will have the same limit as Attica and Thessaloniki. Certainly the same will apply in the case of Evia, which also cannot be a viable solution for those who might be interested in acquiring a property, at a lower cost, in an area very close to Athens.
Accordingly, throughout the rest of the country the limit will increase from the current 250,000 euros to 400,000 euros. In practice, some may want to acquire a newly built holiday home in areas of mainland Greece, but clearly this buying group cannot cause a sharp increase in prices, thus excluding domestic buyers, as happened in some areas of Attica, especially in the last time.
This is precisely the complaint of the real estate market operators and those active in the investment immigration market, that the “golden visa” program was not responsible for the increase in house sales prices and even more so in rental prices. As they say, the only reason this happened was last year’s increase of the minimum investment amount to 500,000 euros in the northern and southern suburbs and the center of Athens, but leaving a “window” for the selection of a number of areas such as Piraeus and the western suburbs , where the limit was kept at 250,000 euros. This particular event directed demand towards these points causing a sharp increase in asking prices, although foreigners moved almost exclusively to newly built or fully renovated properties and not to any kind of house, which was suddenly valued at 250,000 euros instead of the 120,000-170,000 euros that was its price a few months ago.
Something similar may happen this year, especially where there is room to make a transaction at 250,000 euros, or even at 500,000 euros, if it is a newly built construction, e.g. in the southern or northern suburbs. It is therefore possible, precisely because of the new changes, that the distortion caused last year in the housing market will be repeated, worsening the conditions in the housing market. It is reminded that those interested will be able to secure the right to receive a residence permit under the current regime (and not with the 400,000/800,000 euros), provided they have signed a private agreement or preliminary agreement by September 30, 2024. After that, they have time to sign the final contract by the end of the year or to look for a new property by the spring of 2025. Another important parameter is that now the surfaces of the properties to be purchased must be at least 120 sq.m., while utilization through short-term leasing is prohibited.
As reported by market players, such as Mr. Lefteris Potamianos, president of the Athens-Attica Realtors Association, even though the €500,000 limit has been in force for almost 8 months in the center of Athens, prices have not only not decreased, but on the contrary they continue to move upwards, increasing the desperation of those households who wish to acquire a more affordable property, but cannot. “It appeared in practice that it was not the “golden visa” that pushed the prices up, but the lack of supply due to the thousands of closed properties”, notes Mr. Potamianos.
With a limit of 250,000 per change of use
The new framework for the “golden visa” also has an important new parameter, which may contribute to the gradual increase in the supply of apartments for rent. This concerns the provision of the possibility to purchase properties worth 250,000 euros if they change their use and are converted into residences before the application for a residence permit is submitted. In other words, a foreign investor will be able to buy, for example, an office, a warehouse or an industrial property, as long as it changes its use and becomes a residence, until the request for a permit is submitted.
As real estate market executives explain, this measure has been positively accepted by the market, as it will direct some investors to more productive investments, such as the utilization of vacant or depreciated properties, and at the same time may increase the housing stock. If these estimates are confirmed, the increase in housing supply may also create pressure on prices.
Source kathimerini.gr