Uncertainty in building permits and slowdown in the housing market

A study by IOBE forecasts a 20%-40% drop in construction due to the New Building Code (NOK). Building permits, which peaked last year, collapsed by 51% in the first months of 2025. A gap in construction is also expected after the end of the Recovery Fund.

While the infrastructure sector in Greece is making progress, supported by European resources and large public works (€8.73 billion in the 2025-2026 biennium, in addition to €17.3 billion in the backlog of technical companies), private construction and the housing market are showing signs of fatigue.

Uncertainty regarding the new building terms and urban planning regulations, especially after the Council of State's decision on the incentives of the New Building Code (NOK) and the suspension of building permits with NOK bonuses, is negatively affecting the sector. In the first months of 2025, building permits for new homes decreased by 51% and the total area by 49% compared to 2024. The cancellation of the NOK incentives and the regulations requiring re-examination of non-activated permits within 2024 have led to a 'freeze' in activity and a burden on the investment climate.

According to an IOBE study on behalf of TMEDE, the completion of the Recovery and Resilience Fund projects in 2026 may create a gap in domestic construction activity. Mr. Giorgos Maniatis, head of sectoral studies at IOBE, stated that the size of the gap will depend on the progress of projects from other funding programs.