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What will happen in Thessaloniki’s real estate market? Will prices go up or down? Is Thessaloniki still a hotspot for foreign investors? How is Greece’s government impacting real estate policies and taxes in 2025?
We’re constantly asked these questions because we’re deeply involved in this market. Through our work with local real estate agents, property developers, and clients who buy properties in Thessaloniki, we’ve gained firsthand insights.
That’s why we created this article: to provide clear answers, insightful analysis, and a well-rounded perspective on market predictions and forecasts.
Our goal is simple: to ensure you feel informed and confident about the market without needing to look elsewhere. If you think we missed the mark or could do better, we’d love to hear your thoughts. Feel free to message us with your feedback or comments, and we’ll work hard to improve this content for you.
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1) Foreign investors will show more interest in unique properties in the city's historical districts
Thessaloniki's historical districts are catching the eye of foreign investors more than ever.
With foreign direct investment in Greece hitting 5 billion euros in 2023, countries like Germany, the USA, and China are leading the charge. A big chunk of this investment is flowing into the services sector, especially real estate, making Thessaloniki a hotspot for those seeking unique properties.
In the heart of Thessaloniki, property prices have jumped by 21% in the first half of 2023, now averaging around 2,710 euros per square meter. This surge highlights the growing demand for properties in historical districts, where some premium spots can fetch up to 10,000 euros per square meter.
The scarcity of unique properties in these areas is a key driver of demand. Refurbished apartments in the city center are particularly appealing to young buyers and expats, offering attractive investment opportunities with high returns. Thessaloniki's cultural allure and vibrant tourism scene only add to its investment appeal.
For those in the know, Thessaloniki's blend of history and modernity is a winning combination. The city's rich cultural tapestry and dynamic lifestyle make it a magnet for international buyers looking for something special.
Investors are not just buying properties; they're buying into a lifestyle. Thessaloniki offers a unique mix of old-world charm and contemporary living, making it a prime choice for those seeking a distinctive investment.
Sources: Enterprise Greece, My Luxe Point, The Luxury Playbook
2) Rental yields in Thessaloniki will rise as short-term rental opportunities increase
The rental market in Thessaloniki is set to thrive thanks to a surge in short-term rental opportunities.
In 2023, Thessaloniki saw a boom in tourism, with 2,438,842 overnight stays, a 14.75% jump from the previous year. This influx, especially from American tourists who increased their stays by 33.33%, shows the city's rising charm as a travel hotspot.
Platforms like Airbnb are reshaping the scene. Thessaloniki now hosts 3,600 short-term rentals, a notable number compared to its 4,800 hotel rooms. This trend reflects a growing preference for flexible stays, fueled by lifestyle shifts and urban growth.
Economic signs are positive, with the hospitality and tourism sectors on the rise. In 2023, the Revenue Per Available Room (RevPAR) climbed by 17.6%, even though Thessaloniki had the lowest Average Daily Rate (ADR) among ten European cities. This points to a strong market for short-term rentals, offering better returns than traditional leases.
Investors are eyeing Thessaloniki for its potential. The city's blend of culture, history, and modern amenities makes it a magnet for tourists and a promising spot for property buyers.
With more visitors seeking unique experiences, short-term rentals are becoming a preferred choice, driving up yields and making Thessaloniki a lucrative market for property investment.
Sources: GTP News, AirDNA, GTP News
We have made this infographic to give you a quick and clear snapshot of the property market in Greece. It highlights key facts like rental prices, yields, and property costs both in city centers and outside, so you can easily compare opportunities. We’ve done some research and also included useful insights about the country’s economy, like GDP, population, and interest rates, to help you understand the bigger picture.
3) Rental yields will drop slightly in high-demand areas as property prices rise faster than rents
In 2023 and 2024, Thessaloniki's property market saw a significant rise in prices, especially in high-demand areas.
By November 2024, the average price for residential properties hit €2,159 per square meter, showing a 7.52% increase from December 2023. However, rental prices didn't keep up. In November 2024, the average rent was €8.23 per square meter per month, which was actually a slight drop of 0.84% from December 2023.
Even though some areas, like the outskirts, saw a 20% surge in rental prices during Q3 2024, this increase was still slower compared to the rise in property prices. This trend isn't unique to Thessaloniki; many cities worldwide have experienced similar patterns.
High demand often leads to property prices rising faster than rents. This is usually due to limited supply and increased demand, which drive up property values more quickly than rental prices can adjust.
In Thessaloniki, high-demand neighborhoods will likely see a slight decrease in rental yields as property prices outpace rent increases. This means that while property values are climbing, rental income isn't keeping up at the same rate.
For potential buyers, this could mean that investing in property might offer more value in terms of capital appreciation rather than rental income. Understanding these dynamics can help in making informed decisions about where and when to invest.
Sources: Ground News, Indomio, Spitogatos
4) More foreign investors will enter Thessaloniki’s residential market due to changes in property tax laws
Thessaloniki's residential market is now a hotspot for foreign investors thanks to recent changes in property tax laws.
Imagine buying a property and not having to worry about the usual 15% capital gains tax on profits. That's exactly what's happening in Greece, where the government has suspended this tax until the end of 2024. This means investors can buy and sell properties without the extra cost, making quick property flips a lucrative opportunity.
But that's not all. The reduction in property transfer taxes has also made it cheaper to enter the market. Thessaloniki offers real estate prices that are still lower than many European cities, so you get more bang for your buck here. It's a city where your investment can stretch further, offering great value.
There's also a suspension of VAT on new building permits until the end of 2024. This policy has sparked a wave of new construction and renovation projects, making the market even more dynamic. For international buyers, this means less tax burden and more opportunities to invest in fresh developments.
Thessaloniki is buzzing with potential, and these tax changes are a big reason why. Non-residents find the reduced property tax burdens particularly appealing, which is boosting the real estate market significantly.
With these incentives, Thessaloniki is not just a city to watch; it's a city to invest in. The combination of tax breaks and affordable prices makes it a prime target for international buyers looking to make a smart investment.
Sources: NTL Trust, The Luxury Playbook
5) Property values in Thessaloniki's waterfront areas will rise significantly as new developments boost their attractiveness
The waterfront areas of Thessaloniki are on the brink of a property value boom thanks to exciting new developments.
One of the big drivers is the EUR 180 million expansion of the 6th Pier at Thessaloniki Port. This project, set to wrap up by 2025, will not only boost the port's capacity but also pump up the local economy with substantial annual revenues. It's a game-changer for the area, making it more attractive for investors.
Property prices in Thessaloniki have been climbing, with a 7.6% increase in 2023. This rise is catching the eye of both local and international investors who see the potential for long-term rental income and capital growth. The city's ambitious Thessaloniki 2030 strategy is also a big part of this, focusing on transforming the city with major infrastructure and urban development investments.
New residential and commercial projects along the waterfront, like the luxury properties in Thermi, are set to push property values even higher. These developments are drawing in wealthy buyers, adding to the area's allure. Plus, the completion of the Thessaloniki Metro in late 2024 is making these waterfront spots more accessible and appealing to both residents and investors.
Improved transportation links are a key factor here. With the metro and other infrastructure projects, getting around Thessaloniki is becoming easier, which is a big plus for anyone looking to invest in property. The city's focus on enhancing connectivity is a smart move, making these waterfront areas even more desirable.
All these elements combined are setting the stage for a significant increase in property values in Thessaloniki's waterfront areas. It's an exciting time for the city, with plenty of opportunities for those looking to invest in real estate.
Sources: Railway Pro, The Luxury Playbook, GTP News
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6) Demand for affordable rentals in convenient locations will grow as the student population increases in the city
The city's growing student population is driving up the demand for affordable and conveniently located rental properties.
In 2024, Aristotle University of Thessaloniki enrolled 92,090 students, a significant increase that naturally boosts the need for housing. More students mean more people looking for places to live, and this is especially true for those who prefer to stay off-campus.
Interestingly, 5% of these students are international, and they often choose off-campus housing due to cultural or personal preferences. This trend adds to the demand for rentals, as many students find off-campus living more convenient and affordable than staying on campus.
Despite a 5% increase in the overall supply of student housing across Greece, there's still a shortage, with rental prices for student housing jumping by 10% as of June 2024. This shows a significant demand that isn't being fully met, especially in popular student areas.
In Thessaloniki, neighborhoods like Stavroupoli and Evosmos are hotspots for budget-friendly rentals. Here, average asking prices are around €6.7 and €7.2 per square meter, making them attractive options for students on a budget.
These areas are not just affordable but also conveniently located, making them ideal for students who want to balance cost with accessibility to the university and city amenities.
Sources: Spitogatos, EduRank
7) Property prices in the city center will rise steadily as urban living becomes more popular
Thessaloniki's city center is on track for a steady rise in property prices as urban living becomes more appealing.
People are flocking to city centers for the convenience and vibrant lifestyle they offer. Thessaloniki is no exception, with its bustling streets filled with cafes, cultural spots, and social events that have gained popularity recently. The city's charm is undeniable, drawing in those who crave the energy and amenities of urban life.
Thessaloniki is also seeing a wave of infrastructure upgrades, like the new metro system and a refreshed bus fleet. These changes are making city life even more attractive. The Greek government is pouring resources into projects like the FlyOver motorway, aiming to transform Thessaloniki into a model city of development.
Looking at the numbers, property prices in Thessaloniki's city center have been climbing steadily. From 2016 to 2022, there was a noticeable upward trend, and by August 2023, the average price hit €1,927 per square meter. This rise is partly due to the limited land available, which naturally drives up demand and prices.
Thessaloniki's urban appeal is further boosted by its strategic location and historical significance, making it a hotspot for both locals and international buyers. The city's ongoing transformation and the government's commitment to development are key factors in this property boom.
With these developments, Thessaloniki is not just a place to live but a thriving hub of activity and growth, attracting those who want to be at the heart of it all.
Sources: GTP News, Rewize, Railway Pro
8) Thessaloniki’s property prices will grow moderately as the city attracts more local and international buyers
Thessaloniki's residential property market is set for moderate growth as the city becomes more attractive to both local and international buyers.
In recent years, Thessaloniki has seen a noticeable increase in property transactions, reflecting a healthy demand for homes. This demand is driven by both local residents and international investors who are eyeing the city as a promising investment opportunity. The Greek residential real estate market is on track to reach $7.94 billion by the end of 2024, underscoring the growing interest in the area.
Foreign investment plays a crucial role in this growth. With Greece's real estate market expected to hit a value of $1.53 trillion by 2024, residential properties are taking center stage. This influx of foreign capital is partly due to government incentives like the Golden Visa program, which offers residency to investors, making Thessaloniki an even more attractive option.
Thessaloniki's charm is further enhanced by its ongoing infrastructure improvements. The city's 2030 strategy includes plans to modernize rail transport, develop a metro system, and enhance road infrastructure. These efforts aim to boost connectivity and make the city more appealing to potential buyers. Such developments are not just about convenience; they are transforming Thessaloniki into a more sustainable and livable city.
Urban development projects, including a new general urban plan, are set to reshape Thessaloniki. These initiatives are designed to make the city more sustainable, which is a key factor for many buyers looking for long-term investments. As Thessaloniki evolves, its appeal to both local and international buyers is expected to grow.
Overall, the combination of foreign investment, government incentives, and infrastructure improvements is positioning Thessaloniki as a prime location for property investment. The city's transformation into a sustainable and well-connected urban center is likely to continue attracting buyers from around the world.
Sources: The Luxury Playbook, eSales International, Railway Pro
We made this infographic to show you how property prices in Greece compare to other big cities across the region. It breaks down the average price per square meter in city centers, so you can see how cities stack up. It’s an easy way to spot where you might get the best value for your money. We hope you like it.
9) Thessaloniki’s luxury real estate prices will rise as more foreign buyers target high-end areas
Foreign buyers are flocking to Thessaloniki's luxury real estate market for several compelling reasons.
In 2023, Greece's Golden Visa program played a big role in boosting foreign direct investment in real estate, with an 8% increase, reaching €2.13 billion. This program is a magnet for non-EU buyers, offering residency permits in exchange for real estate investments.
Thessaloniki has caught the eye of investors from the United States, Israel, Germany, and the United Kingdom. The Thessaloniki Hotels Association noted that interest from these countries was particularly high in 2023. The city's waterfront areas are especially hot, with property prices jumping 83.5% from Q3 2019 to Q3 2023, showing a strong demand and potential for great returns.
Luxury developments are popping up all over Thessaloniki, like the modern residences in the Panorama area, which are part of private gated complexes. These projects are drawing in significant investments, as investors are keen on the city's real estate market.
Thessaloniki's charm and economic promise are driving up house prices, which saw a 12.19% growth in Q1 2024. The city's rich history and vibrant culture make it an attractive spot for high-end real estate.
Sources: ETIAS, Kredium, NTL Trust, Le Figaro Properties
10) Property prices in Toumba will rise as it becomes popular for student housing
The Toumba area in Thessaloniki is becoming a prime spot for student housing, which is set to boost property prices.
With the Aristotle University of Thessaloniki having around 88,283 active students in 2023, the demand for nearby student accommodation is skyrocketing. This surge in student numbers is a major driver for the housing market in the area.
Rental prices in Thessaloniki reflect this trend, with studios going for €180 to €340 and larger apartments from €300 to €600. These figures highlight the strong demand for student housing, which is likely to push property prices even higher.
Investors are taking note, with a noticeable increase in investment in the Greek real estate market, particularly in urban areas like Thessaloniki. Developers are keen to capitalize on the growing need for student accommodations, further fueling the rise in property values.
As more students flock to the area, the demand for housing close to the university is expected to continue rising. This trend is attracting real estate developers who are eager to meet the needs of this expanding market.
With these dynamics at play, Toumba is on the cusp of becoming a key player in the student housing sector, making it an attractive option for property buyers looking to invest in a thriving market.
Sources: EduRank: Aristotle University of Thessaloniki, HVS: Student Housing - General Overview and the Greek Reality, To Vima: Surge in Investment and Soaring Housing Prices Across Greece
11) Young families will be drawn to Thessaloniki's western suburbs as infrastructure and amenities improve
The western suburbs of Thessaloniki are becoming a hotspot for young families.
Thanks to the Thessaloniki 2030 strategy, the area has seen a wave of improvements. Major investments have been poured into infrastructure, like the new FlyOver motorway and metro system, which are designed to ease congestion and improve connectivity. This means families can now enjoy smoother daily commutes.
Public transport has also gotten a boost with the addition of 110 new electric buses and fresh bus routes. These changes, rolling out in late 2024, are set to make traveling between the suburbs and central Thessaloniki a breeze.
Education is another area seeing growth. New schools and educational facilities are popping up, offering better opportunities for children. Plus, a new hospital is enhancing healthcare services, ensuring families have access to quality care.
The waterfront revitalization project is a game-changer, too. With its lush green spaces and recreational areas, it’s creating a higher quality of life for those seeking a balanced lifestyle.
All these developments are making the western suburbs of Thessaloniki a more attractive option for families looking to settle down.
Sources: Railway Pro, GTP News, World Bank Blogs
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12) Real estate investment will grow around the Thessaloniki International Fair as commercial activity increases
The area around the Thessaloniki International Fair is becoming a hot spot for real estate investment.
One big reason is the boost in infrastructure—think better roads, a revamped railway network, and a more efficient port. These upgrades are turning Thessaloniki into a bustling business hub, making it a magnet for commercial activities.
Since 2022, the commercial real estate market in Thessaloniki has been on the upswing. There's a strong demand for office and retail spaces, with projects like the Skyline project showcasing this trend. The buzz around these spaces is also driving up property prices, especially along the waterfront, where prices have jumped 83.5% from Q3 2019 to Q3 2023.
The Greek government is also playing a big role in this transformation. They're actively promoting Thessaloniki as a commercial center with incentives like state aid for investments, wage subsidies, and fast-track licensing. These perks are drawing businesses to the area, making it even more attractive for investors.
Events like the Real Estate Expo North and the 3rd Real Estate Forum are further proof of the government's commitment to boosting Thessaloniki's commercial appeal. These events not only highlight the city's potential but also provide a platform for networking and investment opportunities.
With all these factors in play, the area around the Thessaloniki International Fair is set to become a prime location for real estate investment, driven by increased commercial activity and government support.
Sources: Ered.gr, Real Estate Expo North, Enterprise Greece
13) Demand for energy-efficient homes in Thessaloniki will grow due to stricter environmental regulations
Stricter environmental regulations are making energy-efficient homes a hot topic in Thessaloniki.
Back in 2023 and 2024, Greece saw a boom in energy-efficient homes, with over 15,260 residential buildings earning top energy ratings like A or A+. This shift is largely due to the Greek government's push for greener living through initiatives like "Exoikonomo." While not everyone has jumped on board yet, the program highlights a clear governmental effort to make homes more energy-efficient, aligning with the EU's tougher building energy performance standards.
Rising energy costs are another big reason people are eyeing energy-efficient homes. As prices go up, more households are keen to cut costs by opting for homes that save energy. The media's spotlight on climate change and sustainable living is also nudging buyers towards greener choices.
In Thessaloniki, this trend is particularly noticeable. The city's real estate market is feeling the pressure from both the EU's regulations and local demand for energy-efficient homes. Buyers are increasingly aware that investing in such properties not only helps the planet but also reduces their monthly bills.
Insiders say that energy-efficient homes in Thessaloniki are becoming more than just a trend; they're a smart investment. With the government's backing and rising energy costs, the demand for these homes is expected to grow. This makes it a good time for potential buyers to consider energy-efficient options.
So, if you're thinking about buying property in Thessaloniki, keep an eye on energy-efficient homes. They're not just eco-friendly; they're also a savvy financial move in today's market.
Sources: Statista, Eteron, E3S Conferences
14) Rents in student areas will keep rising as universities grow and attract more international students
Thessaloniki is seeing a surge in student numbers, which is pushing up housing demand.
In the heart of the city, areas like Nea Paralia, Saranta Eklisies, Doxa, and Evangelistria have become the priciest spots for students due to this high demand. The Thessaloniki 2030 strategy is set to transform the city into an educational hub, with plans for new schools and student neighborhoods.
This initiative is expected to draw even more students, further boosting the need for housing. Even with a 5% increase in student housing supply, demand is still outstripping availability, causing rents to climb.
Once affordable areas like Stavroupoli and Evosmos are now seeing rising rental prices as they become more popular among students. The expansion of universities and the influx of international students are key factors driving this trend.
As universities grow and attract more international students, rents in student-heavy areas will continue to rise. This makes it crucial for potential property buyers to consider these dynamics when investing in Thessaloniki.
Understanding these trends can provide valuable insights for those looking to invest in the city's real estate market, especially in areas with high student populations.
Sources: Spitogatos, Railway Pro, Eteron
We created this infographic to give you a simple idea of how much it costs to buy property in different parts of Greece. As you can see, it breaks down price ranges and property types for popular cities in the country. We hope this makes it easier to explore your options and understand the market.
15) Thessaloniki’s real estate market will grow as new tax incentives attract property investors
New tax incentives are set to boost Thessaloniki's real estate market.
These incentives, rolled out by the Ministry of Economy and Finance, offer exemptions on the 4% Stamp Duty Tax for homes valued at $70,000 or less until 2025. Additionally, there's a postponement of the 20% Capital Gains Tax for individuals until 2025, making it easier for developers and property owners to invest.
In 2023, Thessaloniki experienced a surge in foreign investment, with over 112,000 real estate transactions in Greece by August. Many of these involved foreign investors, signaling a growing interest in the market. Buyers from the United States, Israel, Germany, and the United Kingdom are particularly drawn to the city's waterfront properties.
Thessaloniki is also seeing major infrastructure upgrades, like the completion of the Thessaloniki Metro by November 2024 and a new flyover expressway. These projects aim to enhance the city's living standards and make it a model of holistic development, further attracting investors.
These developments are not just about improving transportation; they are about transforming Thessaloniki into a more vibrant and accessible city. The metro and expressway projects are expected to significantly reduce travel time across the city, making it more appealing for both residents and investors.
With these tax incentives and infrastructure projects, Thessaloniki is positioning itself as a prime location for real estate investment, offering a blend of modern amenities and strategic growth opportunities.
Sources: Grekodom, GTP News, Legal 500
16) Demand for senior-friendly housing in Thessaloniki will grow as the population ages
The aging population in Thessaloniki is driving a need for more senior-friendly housing.
With people in Greece living longer, life expectancy is projected to hit 83.10 years by 2025. This means more folks will be looking for homes that cater to their needs as they age. Many seniors want to stay in their own homes or communities, so there's a push for housing that can adapt to their changing needs.
Most seniors prefer to "age in place," which means they want to remain in familiar surroundings. This trend is pushing the demand for homes that are not only accessible but also adaptable. Think of features like ramps, wider doorways, and easy-to-reach amenities that make life easier for older adults.
Healthcare costs are on the rise, and this is another reason why there's a growing interest in homes that support health and well-being. Senior-friendly homes with integrated healthcare services are becoming more popular. These homes focus on independence, wellness, and accessibility, making them attractive options for the elderly.
The real estate market in Greece is catching on to these needs. Developers are increasingly focusing on creating housing options that cater to seniors. This shift is not just about making homes accessible but also about promoting a lifestyle that supports healthy aging.
In Thessaloniki, this trend is particularly noticeable. The city is seeing a rise in developments that offer senior-friendly features, reflecting the broader changes in the housing market. As the population ages, the demand for such housing options is only expected to grow.
Sources: MacroTrends, Academic OUP, Senior Housing Solutions
While this article provides thoughtful analysis and insights based on credible and carefully selected sources, it is not, and should never be considered, financial advice. We put significant effort into researching, aggregating, and analyzing data to present you with an informed perspective. However, every analysis reflects subjective choices, such as the selection of sources and methodologies, and no single piece can encompass the full complexity of the market. Always conduct your own research, seek professional advice, and make decisions based on your own judgment. Any financial risks or losses remain your responsibility. Finally, please note that we are not affiliated to any of the sources provided. Our analysis remains then 100% impartial.