Thursday, November 21, 2024

Airbnb and Golden visas drive real estate bubble in Europe

The Airbnb market is growing at an enormous pace every year spreading to every city in Europe and driving property prices and rentals up creating a ‘bubble’.

 

Most of the housing in the city centers are becoming Apartment hotels and the landlords are moving outside cities to live converting their city apartments to hotels for Airbnb. This phenomenon is sweeping Europe

 

The Golden visa scheme is also attracting large number foreigners especially Chinese, Russians to invest in the property.  The Golden visa schemes in a way are contributing to increase in Airbnb properties with rental and property prices soaring.

 

Foreigners buying properties under golden visa scheme do not live in the properties and chose to rent it out through Airbnb for attractive rentals.

 

Airbnb vs Golden visa properties

 

In Athens, golden visa properties only form 12% of Airbnb listings,  the rest is rented out by locals, assuming all the properties bought under golden visa scheme are Airbnbied out . Similarly in Barcelona, this is only 8%.

 

Airbnb vs Golden visa

 

Airbnb listings  Golden visas issued for properties  Golden visa requirement
Athens 9,122 1143 €250,000
Lisbon 22,242 6712 (entire portugal, lisbon data not available) €500,000
Barcelona 18,346 1542 €500,000
Malta  300+  105 (IIP purchases) €350,000

Source: Inside the Airbnb

 

We believe the demand for Airbnb will only rise, with or without the influence of golden visa scheme

 

With the above figures, while 80% of local property owners are letting out for Airbnb,  less than 15% golden visa property owners are renting out for Airbnb.

 

To fix this problem of rising prices, The Greek government in order to decouple or  loosen the property market has to quick introduce other golden visa options such as investing bonds, securities for golden visa, if not prices has to go through the roof. Greece last year has announced plans expand the golden visa scheme to include bonds and shares.

 

Prabhu Balakrishnan
Prabhu Balakrishnan
Founder of Citizenship by Investment News. Chief Editor with over 15 years experience in PR and News publishing. He Loves writing about citizenship, residency and wealth migration. CIP Journal is a Leading publication founded in 2017 bringing latest news from CBI/RBI market.

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