There are press reports that the new thresholds for Greece’s Golden Visa will be as follows:

• €800,000 for the prime areas i.e., Kolonaki and the centre of Athens, the sought after southern suburbs such as Glyfada and Voula, the northern suburbs, Thessaloniki, Mykonos, Santorini etc.
• €400,000 for secondary areas such as Piraeus
• €250,000 for areas such as the western suburbs and outside the metropolitan areas of Athens and Thessaloniki

Moreover, Golden Visa holders will not be allowed to rent out their flats on a short-term basis on platforms such as Airbnb and Booking.com.

If these changes are introduced, one would expect the following effects on the market:

1. Demand for housing in the prime areas will decline thereby reducing the upward pressure on the values of used property. This will also mean a reduced supply of housing for long-term rentals since it has been reported that most of Golden Visa holders rent out their properties on this basis. As a result, rental values in these areas will continue their upward trend until demand declines to the level of supply.
2. Demand for the secondary areas will also decline until the market realises that there is very limited supply of the €250,000 units. This will inevitably negatively affect the potential for an increased supply of property for long-term rental thereby fueling rental values further.
3. Demand for €250,000 properties in not so attractive areas will increase thereby fueling values in conditions of limited supply. Hence, the intention of the changes to increase supply and keep rentals and values in check will not be realised.
4. Demand for Greece’s Golden Visa will decline.
5. Economic development arising from the construction of housing units will decline and FDI (foreign direct investments) will be reduced.

As the English say, “the road to hell is paved with good intentions”; these changes may prove to be a glowing example of good intentions going sour.