Hundreds of thousands of property owners are getting increasingly desperate as property market professionals estimate that the number of unlet homes is close to 300,000 and rising. Given that there are some one million houses in the rental market around the country, that means that about one in every three houses and apartments for rent is standing empty.
Owners are unable to lease them even at considerably reduced rates, while it is virtually impossible to sell in the current economic climate as demand is nonexistent. Worse still, the taxes that owners have to pay are much higher today than in previous years, placing an extra burden on landlords with empty properties. The only category of properties that manage to attract tenants relatively easily is one-bedroom apartments and small houses up to 65 square meters. Larger houses, which entail higher maintenance costs etc, remain empty, as is the case with tens of thousands of commercial spaces – offices and stores – owing to the closure of thousands of enterprises.
Furthermore, many tenants have fallen behind on their rent. According to recent data compiled by the Panhellenic Federation of Property Owners (POMIDA), almost 50 per cent of tenants around the country are between two and six months behind on their payments, and in some cases even up to a year. The economic crisis and the high unemployment rate mean thousands of tenants are unable to pay their rent; in most cases in Athens, tenants have not paid their rent for two months, while in Thessaloniki, four out of five tenants have not paid for up to five months. The phenomenon of unreliable tenants is of course nothing new, but before the crisis, they only comprised 15 to 20 per cent of the total.
In the last couple of years, however, their number has increased threefold. Many landlords with tenants are today opting to reduce their rates, based on the relationship they have built over time, as well as to avoid the risk of not being able to find a tenant at all. All this creates huge problems for landlords, as besides the lack of tenants or major delays in rent payment, they also have to pay tax on rents they have not yet collected. The imposition of the special property tax levied via electricity bills has effectively deducted two to three monthly rents from every property on an annual basis, rendering properties a tax burden for owners rather than a form of income.