The European Commission has formally flagged Greece's housing crisis as one of the country's most serious socioeconomic ...

The European Commission has formally flagged Greece's housing crisis as one of the country's most serious socioeconomic challenges, according to its latest European Semester report published earlier this month. Greece ranks among the EU's highest for housing cost overburden, with a significant share of households spending more than 40% of their disposable income on rent or mortgage. The pressure is sharpest in Athens and other economically active urban centers, where rents have climbed faster than wages for years. The Commission identified a combination of factors driving the crisis. Housing supply has been constrained by low construction activity over the past decade, a large stock of aging and energy-inefficient buildings, high numbers of properties not used as primary residences, and the rapid expansion of short-term rentals like Airbnb, which has pulled units out of the long-term rental market. What makes the Commission's report notable is what it explicitly rules out. It rejected rent caps, warning that while they offer tenants short-term relief, they discourage landlords from investing and reduce the overall supply of rental homes. It also rejected demand-side subsidies such as housing allowances, mortgage interest subsidies, and tax breaks, arguing these tools inflate purchasing power temporarily but ultimately drive property prices higher without fixing the underlying shortage. Critically, the report found that the crisis is no longer confined to low-income households. The middle class is increasingly squeezed, with disposable income eroding under rising housing costs. The Commission's recommended path forward focuses on supply. It called for public investment in new and renovated housing, expansion of social housing for vulnerable groups, urban regeneration in deteriorating city neighborhoods, and streamlining the regulatory framework to speed up building permits and new construction. Simplifying zoning laws, land use rules, and construction licensing were all flagged as areas where reform could accelerate housing output. #Greece #HousingCrisis #EuropeanCommission