There is an enormous rise of the sharing economy in Greece, rapid growth in the short-term rental market, and consequent changes it brings to local communities based on a Grant Thornton recent study. For more insights about the landscape of Greek tourism, stay tuned.
Why Is the Short-Term Rental Market in Greece Growing that Fast?
The sharing economy in Greece, particularly the short-term rental market (like Airbnb) based on a recent Grant Thornton study, is growing at unprecedented rates, significantly outpacing traditional industries like hotels. In recent years, short-term rentals have almost caught up with hotels in terms of available beds nationwide, even exceeding them in some regions like Athens.
How Rapid is the Growth of Short-Term Rentals compared to Hotels?
In 2019, hotels in Greece offered around 856,000 beds, while short-term rentals had approximately 428,000. Fast forward to 2023, and hotel beds increased slightly to 886,000, while short-term rental accommodations soared to 858,000 beds – a 100% growth for the sharing economy compared to a mere 3.5% rise in the hotel sector.
Athens has seen particularly stark changes. In 2019, hotels provided 30,200 beds in the capital, whereas short-term rentals had 29,200. By 2023, hotel beds increased to 35,000, but short-term rentals more than doubled to 63,200. The trend is similar across the broader Attica region, with short-term rental beds surpassing 114,000 by the end of 2023, compared to 68,000 for hotels. The average annual growth rate for hotel beds is only 0.9%, while short-term rentals have grown by an impressive 19% per year.
What Changes Does the Rapid Growth of the Sharing Economy Present?
The rapid rise of the sharing economy raises concerns about its impact on local communities and the broader tourism industry. The president of the Hellenic Chamber of Hotels, Alexandros Vassilikos, highlighted that while the hotel sector isn’t against short-term rentals, there is a need for regulation. Greece remains one of the few Western countries without restrictions on the short-term rental market.
Vassilikos emphasized the importance of implementing spatial and temporal limits, as well as standardized regulations, to ensure that short-term rentals operate on a level playing field with other forms of accommodation.
“The goal isn’t merely quantitative growth in tourism,” he stated, stressing the need for investments in infrastructure that improve the quality of life for residents and visitors alike.
How is the Rise of Short-Term Rentals Impacting Society and the Economy?
Grant Thornton’s study on short-term rentals further highlights the economic and social impacts of this growing sector. In 2019, the total number of overnight stays in short-term rentals was 38.5 million, increasing to 104.7 million in 2023 – a staggering 28% average annual growth.
This explosive growth has contributed to rising rental prices across Greece, particularly in Athens. Short-term rentals can command prices that are 200% to 900% higher than long-term leases. For example, in areas like Kallithea, the average monthly rent per square meter for short-term rentals is €32.4, compared to €11.1 for long-term rentals.
How Can Greece Find Balance Between Growth and Sustainability in the Sharing Economy?
As the sharing economy continues to grow in Greece, it is essential to strike a balance between economic benefits and the well-being of local communities.
Regulations that address safety, taxation, and environmental impact can help ensure that the sharing economy develops in a sustainable way that benefits both residents and tourists. The challenge lies in finding that balance to support long-term growth without sacrificing quality of life.
