The time for decisions is approaching for property owners who want to secure a three-year income tax exemption on rental income from properties they are placing on the long-term rental market for the first time in years. The tax incentive window closes on December 31, and the countdown has already begun. Despite recommendations and requests to extend the incentive beyond 2026, it remains unclear whether this will be possible. All indications suggest that the government’s economic team will most likely make final decisions at year’s end, alongside the submission of the 2027 Budget to Parliament.
This uncertainty puts many property owners in a difficult position — owners who, as they have known since 2024, could pay zero income tax for three years on properties they make available for long-term rental. The risk for them is that if September and the Thessaloniki International Fair (TIF) pass without any clarity on whether the incentive will be extended, interested parties will have a very limited window of time to take the necessary steps — and may risk missing the deadline to secure the tax benefit altogether.
Property owners: who qualifies and how they can benefit
The one certainty that owners of properties currently sitting vacant or operating as short-term rentals (Airbnb) can count on is this: provided specific conditions are met and a lease agreement is signed by December 31, 2026, they can still secure a full income tax exemption on three years’ worth of rental income (36 monthly payments) for each property they transition to long-term rental this year.
The measure was introduced from the outset as a temporary and exceptional one. It came with a built-in expiry date, serving as an incentive to bring properties back into the long-term rental market, with the aim of increasing the supply of available rental housing and easing pressure on the housing market and rental prices.
As uncertainty about 2027 persists, however, property owners face a double risk:
– On one hand, rushing to rent out a property without properly vetting the tenant, reviewing the lease contract, or meeting technical requirements could create serious problems down the line.
– On the other hand, waiting for a possible extension risks missing the current deadlines and losing the incentive that is available today.
It is worth noting that the December 31, 2026 deadline does not simply refer to submitting applications or making preparations — it requires the full completion of an eligible lease agreement. This effectively kicks off a 100-day race for interested parties to ensure that all required steps are completed by late November or early December at the latest.
Those who find themselves with unfinished processes after that point risk being unable to complete them within 2026 — and losing the benefit they were aiming for.
Which steps take the most time
The first step for property owners is to review — most likely with the help of an accountant — the tax history of the property they wish to rent out. Qualifying for the tax exemption is not as simple as declaring on a form that the property was “vacant.” It must be demonstrable through the Independent Authority for Public Revenue (AADE) platform that the property was declared as vacant on the E2 tax form for the legally required period, or alternatively, that it was registered as a short-term rental in the relevant registry.
Next, the owner must assess whether the property is practically suitable and ready for long-term rental. For homes that have been sitting empty for three years — or even decades — this may mean: repainting, reconnecting to the electricity or water supply, obtaining certificates, carrying out electrical or plumbing repairs, replacing doors, windows or flooring, renovating the bathroom or kitchen, servicing heating and air conditioning systems, and completing basic energy efficiency and functional upgrades.
All of this takes time. Property owners who know their property requires work would therefore be well advised to start sooner rather than later.
Time will also be needed to find a suitable tenant — posting listings or hiring a real estate agent, scheduling viewings, agreeing on terms with a prospective tenant, and negotiating and drafting the lease agreement.
None of this is enough to lock in the tax exemption, however, unless the lease is also electronically registered on the AADE’s myProperty platform. Even if a handshake deal has been reached, signatures exchanged, or a deposit paid, none of these actions guarantee the tax exemption unless the eligible lease agreement has been formally submitted to AADE in full compliance with all requirements.
For this reason, the safest approach is to have found a tenant and completed the signing process by the end of November or early December, to avoid operating right up against the deadline under pressure from tight timelines, bureaucratic processes, or unforeseen complications.
How owners can save up to 45%
The tax exemption applies to individuals who convert a property to long-term rental in either of the following cases:
– A property that has been declared vacant for at least three years
– A property that was previously used as a short-term rental
The property must henceforth be used exclusively as a residential dwelling, under a long-term electronic lease agreement.
The minimum duration for a long-term lease is three years, as established by the electronic rental contract. A special provision exists for leases of at least six consecutive months to public sector employees, teachers, medical and nursing staff of General Government entities, as well as uniformed members of the Armed Forces and Security Services.
The measure applies to lease agreements signed between September 8, 2024 and December 31, 2026. For vacant properties, the prior status must be documented through the E2 tax form. For short-term rental properties, previous use must be evidenced through the relevant declarations and records.
How the financial benefit is calculated
The exemption takes effect from the month in which the lease agreement is signed and applies to residential properties of up to 120 square metres, with an additional 20 square metres allowed per dependent child.
The arrangement does not mean the owner is exempt from all tax or operational obligations related to the property. The exemption specifically covers income tax — which is levied at a rate of 15% to 45% on rental income received during this specific period. It does not, however, eliminate the annual property tax (ENFIA) or any insurance or other costs associated with owning and renting out the property.
The financial benefit is significant, given that rental income is taxed separately on a progressive scale. A property owner receiving rental income over three years can therefore calculate in advance how much tax they stand to save, based on the total rental income they collect from the properties they lease out.
In every case, the exact benefit is not the same for everyone. It depends on:
– the monthly and annual rental amount,
– the duration of the lease,
– whether all eligibility conditions are met,
– the ownership structure of the property,
– whether there are co-owners,
– the correct registration of the lease with AADE.
