A view of Cyclades in Greece’s Mykonos island, one of the most sought-after locations for foreigners … [+]
Currently, Greece ranks extremely high as an attractive target for foreign investors looking for visas through real estate investment thanks to a confluence of factors that includes narrowing alternatives in the rest of Europe, a resurgent Greek economy and a relatively low minimum threshold for acquiring property.
Announced as a way to ease pressure on highly-sought housing markets such as Athens, Mykonos, Santorini and Thessaloniki, the government is planning to increase the minimum amount of investment required for foreign property buyers to be eligible for a Golden Visa to €800,000 in those in-demand areas.
Greece introduced its golden visa program in 2014, granting a renewable five-year residence permit to third-country nationals purchasing real estate worth at least €250,000.
The visa also features free access to Europe’s 26-Schengen-area countries for business and leisure purposes and includes multiple generations of the investor’s family.
Lower threshold still on
Last August, the government doubled the minimum required investment from €250,000 — then among the lowest in Europe — to €500,000 for locations in high demand and includes access to the coveted visa-by-investment program.
In the rest of the country, where there is less foreign interest to buy, the threshold will remain at €250,000.
“We are discussing a further increase in the threshold for investment which will cover all areas where there is significant pressure on rents,” Prime Minister Kyriakos Mitsotakis told lawmakers in Athens.
“It’s a major investment boost for the country but also a serious measure we are considering to shield the local market,” he said. The measure has received bipartisan support.
A busy street in central Athens
A rush to buy in Greece
The decision by other European countries including Portugal, the U.K., Ireland, Montenegro, Moldova, Bulgaria and Cyprus to sunset or place limits on their highly popular golden visa schemes — and as Spain heads the same direction — has triggered a rush of interest and investment in Greece. Thousands of foreigners, particularly Chinese, have applied for golden visas by buying property in the country.
A report from the bank of Greece shows that the number of residency-by-investment visas has quadrupled in the last year alone. Of recent real estate transactions, 7% are connected to the golden visa program.
During the first half of 2023 ,there were more than 4,000 applications for real estate purchases compared to 1,444 in the same period the year before.
Not good for locals
As in other countries, such a rush has accelerated prices, making it near-impossible for locals to buy.
Such visas by investment schemes have been at the root of serious housing crises in the countries offering them. Increases in housing costs and the effect on local residents were among the main justifications by the Portuguese government for modifying its golden visa program — and is now the argument for Greece’s threshold increase.
The main goal as explained earlier this month by the Minister of Economy and Finance, Kostis Hadjidakis, is to address market distortions bringing more “significant investments” to the country, to reduce the number of visas granted and balance the real estate market.
Already the increase in foreign real estate investment has significantly bolstered state revenues, contributing “more than €2 billion since it started,” according to local media.
Thessalonika, the second largest city of Greece and a popular place for foreign investors looking … [+]
Despite EU pressure
Greece has maintained its golden visa scheme despite pressure by the European Commission that has declared it “undemocratic” to enable wealthy foreigners to ‘buy’ the right to residency — sometimes without even a requirement to live in the country — and becoming “a risk to security, permitting money laundering, tax evasion, terrorist financing, corruption and infiltration by organized crime that is incompatible with EU norms.”
The Commission considers that the granting of E.U. citizenship in return for pre-determined payments or investments, without any genuine link to the member state concerned, is in breach of EU law:
“Investor citizenship schemes undermine the essence of E.U. citizenship and have implications for the Union as a whole. Every person who holds the nationality of an E.U. Member State is at the same time an E.U. citizen. E.U. citizenship automatically gives the right to free movement, access to the E.U. internal market, and the right to vote and be elected in European and local elections. “
The commission also complains that “Russian or Belarusian nationals that are subject to sanctions and significantly supporting the war in Ukraine have acquired E.U. citizenship or privileged access to the E.U., including to travel freely in the Schengen area, under these schemes.” The European Commission urges Member States “to immediately repeal any existing investor citizenship and residence schemes” due to “the inherent risks they pose.”
Transparency International has also called for an end to golden visa programs that “have turned European Union (E.U.) citizenship and residency rights into a luxury good that anybody with enough money can buy. This is a particularly attractive prospect for criminals and the corrupt – and numerous scandals have proven they are taking advantage. These E.U. golden passport and visa schemes are not about genuine investment or migration – but about serving corrupt interests.”
The organization proposes that golden visa schemes be regulated with adequate checks in place and recommends that governments review previously-awarded golden passports and visas: “The European Commission should oversee the process of revoking citizenship or residency from those who should have never received it in the first place.”
