Monday, 17 December 2018 23:47


As the Ukrainian war is raging in Europe and whilst the COVID-19 pandemics- is far from being over, expectations are high and prospects bleak

The UP Side

  1. Most travellers worldwide, after two years of abstinence, yearn to travel
  2. COVID19 and its omicron (1-2) variations seems to be weaking, worldwide pointing at the end of the tunnel maybe.
  3. A large part of the travelling population has been either vaccinated or has fallen ill, so now feel more comfortable to travel
  4. Many countries and airlines are waiving covid barriers and controls (eg in Greece plf)
  5. Greece is rising as a world travel top-of-mind destination
  6. Greece is viewed as a "safe" European "sun & sea" destination in turbid times of war
  7. Many new inbound flights have opened from the US and other world markets
  8. If they decide to travel, vacationers will prefer villas for two reasons: distancing due to covid and for families the ability to prepare meals within, as restaurants prices are on the rise

The DOWN Side

  1. The war situation in Ukraine makes many Europeans hesitant or reluctant due to fear to travel, as due to geographical (or psychological?) confusion, many fear Ukraine is "too close for comfort"
  2. If they finally do travel, many recent polls show they most likely will travel within their own country or to close neighboring countries
  3. The world energy crisis and spiraling food prices has weakened significantly available income of most European households that had to pay astronomical electricity and gas bills
  4. Hence, those who travel, in majority will have a limited budget, painting a bleak image for the mass premium and premium villa sectors that addressed themselves to the European middle/upper middle class
  5. Both airline and restaurant prices are on the rise internationally due to energy, operational and food costs constantly increasing
  6. After three stagnant or falling years, villa prices adapted swiftly to rising energy and ops costs, marking sharp increases and still adapting monthly!
  7. As demand for villas in Greece rises and the physical pool remains more or less the same, prices are pushed further up, some destinations already surpassing 2018 or 2019 precovid pricing
  8. Higher real estate taxes in 2022 for many island properties due to new taxation framework (ENFIA) in effect will be passed to renters, pushing prices even further up
  9. Areas that worked heavily or exclusively with Russian or Ukrainian tourists will suffer the most (eg North Greece, Corfu) and have to urgently turn tootehr markets. Similar losses are predicted from the Polish market, a collateral damage.
  10. A multitude of hotels will become viable alternatives to villa renters with their "all inclusive" packages, as meals will take out an ever increasing chunk of their vacation wallet
  11. Western Europe has had a mild winter overall this year and Greece a cold one!


Though there will be streams of vacationers towards Greece, it is highly unlikely they will reach the record numbers of 2018. Due to budget contraints, we will see larger groups travelling together in an effort to decrease overhead costs, a trend we saw in covid years continuing. Many will be going back to hotels instead of villas, feeling now that the covid threat is "over",  thus cannibalizing a good chunk of the mass (low budget villas) and mass premium markets, preferring hotels' tempting all inculsive offers, food prices and meals being a major concern now. Villa prices will rise across all segments and the average vacation stay will, for another, year shrink.

For one more year, due to overall uncertainty, many vacationers will decide very last minute where to travel and stay, as they will also prefer easy-to-reach direct destinations, with little internal or additional domestic travel that will further enroach their limited travel budgets. Squeezed between rising costs and dwindling demand, villas with high operational expenses will see their profit margins drastically shrink, making their operation hardly viable, putting choking pressure on profit margins. The luxury villa segment will not be affected as much by the macro picture, but as a large proportion of high worth customers in certain areas were now exlcuded, eg  Russian monarchs in Mykonos, Corfu, Crete, such destinations may also suffer important losses, extra American tourists expected having a hard time to (finacially) fill.

Overall, a challenging year for all!


© Michael Kiakidis, Managing Director  | Greek Villas 4 Rent .com | March 22