Greeks are beginning to see the ugly side of the online marketplace and hospitality service site Airbnb.
That’s according to a piece published recently in euronews. “Rents are skyrocketing, local residents are “expelled,” and neighborhoods are deserted” says the article.
“Airbnb changed the game in the Greek real estate market,” says attorney Kyriaki Perrou. “It boosted demand for rental property, and helped stabilize the market.”
Sakis Dionysopoulos, President of Dion, a diverse holding company, agrees. “Airbnb turned things around for the property sector,” he says. “It prompted a wave of building upgrades, created jobs for the construction sector, and generated income for property owners.”
That’s something Greece very much needed. The Greek Home Price Index dropped from 100 in 2009 to 58.9 in 2017, following the decline in the overall economy, which depressed incomes and rents. A popular asset turned into a liability even in the hottest property areas of the country. Home ownership dropped from 76% before the crisis broke off in 2010 to 72% recently.
That’s why, in the beginning, the presence of Airbnb in the Greek market was a good thing. At the end of 2018, home prices had recovered, with the Greek Home Price Index rising above 60.
It still is a good thing, if you are still a home owner or a landlord. But it’s a bad thing if you sold your home and turned into a tenant property. “Airbnb has made it difficult for local people to find and afford a place to rent,” adds Perrou.
Theophanis Matsopoulos, Athens Chamber of Commerce and Industry Counsellor, agrees. “There’s a big shortage for long-term rentals, which pushes rents sky high” he says.
That’s the case even in areas that aren’t near city landmarks. Like Patisia, a low income area, where rents are up 25% over the last year.
“And this happens at a time when Greece strives to come off its worst postwar depression, adds Matsopoulos. “ How can Greeks afford these rents?”
The answer is, with the personal income of Greeks during the crisis slashed by what Matsopoulos says is 30%, they can’t.
Meanwhile youth unemployment rate remains close to 40%. And that makes rent affordability a big problem for young people.
Airbnb’s ugly side isn’t confined to people looking for rental spaces. It extends to hotels, which face stiff competition from the company’s rentals, as has been the case in cities around the world where Airbnb has been expanding its presence.
While it’s still unclear whether the benefits of Airbnb exceed the costs, one thing is clear: Athens locations near landmarks will no longer be a place for locals.