Invest in Lesvos / Lesbos real estate in Greece

Why choose Lesvos / Lesbos island for your Real Estate investment in Greece?

• Some of the most affordable real estate in all of Greece. Ruins with sea views can be had for as little as €25,000.
• Very decent capitalization rates or net rental yields of 7% are achievable if you invest in properties in the small towns with a lot of tourists and snowbirds from Northern Europe.
• €300,000 is enough to get you a nice plot with a brand new villa. Amazing lifestyle.
• Northern Europeans are moving down to Lesvos in droves for a better lifestyle, affordability, and tax incentives.
• Turkey is a 45 minute boat ride away. Tourism from Turkey is booming as Lesvos has become more affordable than Turkey.
• Tourism and investment from Israel is also booming, so much so that there are now direct flights between Tel Aviv and Lesvos.
• You just need to be aware that the process for non-EU people to buy real estate in Greece takes an extra 7 months as it is coastal property right on the border with Turkey and requires extra approval from the Greek authorities.
• Real estate in Lesvos Island is a conservative investment at low valuations with very decent cashflow for those who are ok with euro exposure.
• Just be aware of the low liquidity nature of the market. Selling is not easy.

Tourism from Turkey is absolutely booming on Lesvos

Greece has granted Turks a special 4-day express visa to visit 5 Greek islands close to Turkey. This is an absolute game changer for these islands. Why?

• Turkey is a massive market of 80 million people.
• These islands are now the only place in the European Union that Turks can visit without a full-on Schengen visa. This is a huge deal as Schengen visas are hard to obtain.
• Turks easily get this special visa online for €60.
• The cost of living on these Greek islands is now lower than on the Turkish riviera, which means a flood of Turks coming over for a cheaper vacation.
• Turkish social media is full of influencers visiting the Greek islands recommending them as a great destination.
• Lesvos is experiencing a boom in tourism income, which is not yet reflected in property prices.

People often failt to appreciate how close Lesvos / Lesbos is from mainland Turkey. It is a mere one hour ferry away from the closest Turkish port, and 2.5 hours away from Izmir, Turkey’s third largest city. This is a massive market for Airbnbs on the island.

However investors must be cognizant of the constant geopolitical issues in this part of the world. This easy, special visa for Turks could be removed in any bout of tensions between the neighbours. But for now, this is a success as business on the islands is booming. It will get extended into 2025.

Video case study of various real estate investments on Lesbos / Lesvos Island

This video was made when Lesvos / Lesbos real estate was still a good option for the Golden Visa, but things have changed. To get a Golden Visa through Lesvos real estate, you must now buy a historical building or ruin of minimum €250,000 and get it renovated.

You can then rent it out long term (though the market is weak) or use it yourself. Short term rentals are now allowed anymore for Golden Visa purchases.

However if you invest without the Golden Visa in mind, you can absolutely rent out on Airbnb.

Get in touch with Angelina to invest in Lesbos / Lesvos Real Estate and maybe get a Greek Golden Visa

Other ways to get Golden Visas and Citizenships by Investment:

• High ROI Real Estate for investing in the Greece Golden Visa
• Fastest way to get Permanent Residency in Malta
• Be careful when you buy a passport in the Caribbean
• Best Deal for the Citizenship by Investment in Turkey
• How to obtain Vanuatu Citizenship by Investment
• Buy affordable real estate to obtain the Egyptian citizenship by Investment
• Saint Lucia Citizenship by Investment
• St Kitts & Nevis Citizenship by Investment

Transcript of “Real Estate Investing on a Greek Island: ROI case study on Lesbos / Lesvos Island“

LADISLAS: Hello everyone, Ladislas of thewanderinginvestor.com. So today we’ll be doing a case study of a real estate investment on the island of Lesvos, Greece, that has some pretty interesting lifestyle but also rental yield numbers. We’ll be doing this together with Angelina, who managed the whole project, as well as John and Allison, who bought the house. How are you?

ANGELINA: We are doing pretty well, very happy here. We still have beautiful weather and we’re in a very nice renovated house.

LADISLAS: So one, we’ll be discussing why invest on Lesvos Island in Greece, what is the thesis for the island; two, we’ll be discussing why John and Allison decided to invest there from New Zealand, so it’s not around the corner; and then three, we’ll be looking at the case study, so the exact numbers, what the house used to look like, all the purchase costs, closing costs, the renovation costs, and then the running costs of the Airbnb and then the post-renovation results, the pictures, all of that to get to the net rental yield, so the full detailed case study. So Angelina, a bit of background, we were working together in Turkey, you managed some of my properties in Istanbul and you renovated some of these properties as well.

And two years ago, you were harassing me, really. You kept telling me, Ladislas, you have to come to Lesvos Island in Greece, there’s potential there, and I really wasn’t that interested. I wasn’t that interested in going to some Greek island, I had a lot of things to do, but you kept insisting and then eventually I agreed and then I took the boat over from Izmir together with my family and we stayed on the island for about a week and then you showed us around and it was really interesting. Like I saw the investment case, we did a bunch of case studies together, a video, and you know, since then prices have gone up and the thesis is working out well, if anything it’s even better than we had projected.

Why invest in Lesbos real estate?

LADISLAS: So Angelina, I’ll let you explain what is the thesis for investing in real estate on Lesvos Island in Greece.

ANGELINA: This island has great potential for the tourism and the tourists are coming from different countries, especially North European: Swedish, Norwegians, Danish, Dutch. And lately we had many, many Turkish tourists. They were coming always here, but after two years ago, after the government of Greece and Turkey decided to sign a voluntary agreement and let Turkish people come here with visa at the port, without Schengen visa, so seven days we say visa-free, they visiting the island. So we had huge flow of Turkish tourists. The previous year was, I don’t know, a hundred thousand, this year they increase double of tourism from Turkey. Turkish people prefer to come here because here it’s cheaper. The prices on food and restaurants four times, alcohol four times, five times, food restaurants three, four times cheaper than at the same Turkish beautiful coast, same as Greek beautiful Greek coast, but the expenses three, four times cheaper.

The accommodation, the same, accommodation two times cheaper. So Turkish people from Izmir, from Istanbul, of course the one who can afford nice holidays with their own cars coming through ferry here and we had 50 percent of accommodation this year of the houses that I manage booked by Turkish tourists. So also we have many, many Israelis. Israelis started investing here eight years ago, but lately two years after war started, they investing much more here. They bought huge hotel that need renovation for 2 million Euro in the middle of Plomari. We didn’t even notice that this hotel because we had bar there only on the bottom. So they investing in hotels, they investing in old houses the same like my clients, and they investing in plots, they building villas, not only lifestyle villas, villas for rental. The renting villas from 400 till 700 Euro per day depends on villa facilities, size, pool, view. And of course they renting the houses in Plomari and now they start investing in business, so they gonna run hotels, they gonna run some bars.

Property prices and renovation costs in Plomari, Lesbos

ANGELINA: We have very good impact of Israelis on Plomari. So it’s developing very quickly. So last year the houses price like small house, cheap house prices was in double. If you could buy house for 25,000 Euro two years ago, now the same house you can buy only for 50,000 Euro. The mid-say price houses like 100 Euro you could buy or plot two years ago, now you can buy only for 150 Euro no less. And the big properties prices increase 20 percent like 200,000 property you can buy for 240, 250. So the price significantly raised up for the investment for purchase, but the building and renovation cost maybe 10 percent up, 15 percent, not so much. So it’s still good to buy the property that need renovation or need to be rebuilt and created your beautiful home and your beautiful rental house.

LADISLAS: You know, back then when I was visiting, the thesis was continued growth in Northern European tourism because, you know, Northern Europe pretty expensive, increasingly people all the boomers are retiring etc., they’re looking to spend the, well essentially the European version of snowbirds really. That’s what it comes down to, so Europeans just coming down and Northern Europeans and living in Greece. So that was the thesis, it was clear that this was going to continue increasing, it has continued to increase. Second part of the thesis was Israeli investment. Now since then as you say two things have changed.

Increase in Turkish tourism to Greek islands

LADISLAS: Since then what has transpired: Northern tourism is still increasing as was predicted, Israeli investment is not just continuing along but is booming because of the issues they have, they’re taking capital out, and then three, this agreement with Turkey for visa-free travel for Turks is absolutely massive. So specific few Greek islands are the only places in the European Union that Turks can go to without a visa, without a Schengen visa. So it’s huge. At the same time since then you’ve had a lot of inflation in Turkey in USD terms and even more so when it comes to tourism, drinking and eating out at restaurants. So there the inflation has been even more than the average CPI in Turkey.

So what happens is you have a reservoir of millions of Turks that want to go vacation overseas because it’s become so expensive in Turkey, and then there are these little Greek islands with ferry connections and it’s a nice ferry, it’s just like you’re on the ferry for an hour or two hours and then they can get to Greece, which they can see literally from where they are from the coast. And they can go spend time there, they’re in Europe, they can drink, they can eat, it’s a lot cheaper. And these islands are right next to the most secular parts of Turkey because one of the big catalysts ultimately is drinking, drinking has become extremely expensive in Turkey. The government keeps hiking taxes on drinking, so the price of alcohol keeps going up more and more, and then these Greek islands are almost like duty-free for Turks from a drinking point of view. So they literally just come for a few days to go have fun, go to the restaurant, go out drink and then they go back. So and it’s right where all the secular Turks are on the coast. So it’s no wonder that Turkish tourism is absolutely booming there.

I’d say it also highlights a risk that the islands are becoming quite dependent on Turkish tourism, so you know if there were to be more tensions between Turkey and Greece, which happens on and off, then it means there’s also some inherent volatility in the tourism industry as well.

Lesbos vs. Mykonos

ANGELINA: Actually we have increase in North European tourists and especially the young one, young couples between 20 and 30 came a lot this summer. And I asked the question why here not why the Mykonos or other places where you can party all night. Here we have also party you can party, we have very nice nightclubs, but still it’s not Mykonos. They said because of the price.

North Europeans also don’t want to spend more and they like the food because here the food are very natural, organic. We have all this island is green and has farming. It’s 11 million olive trees so we have olive oil like water here. The prices for olive oil are so cheap you can buy one liter of olive oil for 5 Euro. So the all restaurants they use pure organic olive oil when they cook dishes. So when you eat at restaurant, yes you eat very healthy, you eat like home food and the fishing is here so they fish directly here in the we have our fishermen so they use a local fish they don’t buy fish from somewhere else and they use a local animals because also have sheep, goat, all this meat animals around. So everything what you eat in restaurant is local but the prices are so good, two person with dishes, starter and we say two drinks or three drinks, 40 Euro, only 40 Euro you pay for all. You can have three starters, two main dishes, drinks and all this cooked on organic olive oil.

So these young couples they are coming here because they can afford also. And of course they all the age of North European they love the place they love the food and they investing as well. We have many investors, still they investing. This is what the first flow of investors from North Europe 40 years ago they start investing here, now they start investing even more while they see that Israeli investing so much and other nationality even Greeks from Athens coming and investing now on Lesvos particularly in Plomari. So North European start buying more here too because they understand and in future it will not be so affordable anymore.

Interview with Angelina’s clients who bought property in Lesbos

LADISLAS: Interesting. So John and Allison you came all the way from New Zealand to invest on Lesvos Island, why?

JOHN: Yes, we’re getting on towards retirement age now, so it’s part of our retirement planning really. I haven’t been to Greece probably since 1986 so it was 40-something years since I was here. I didn’t know if it would be the same Greece that I remembered, fortunately it was and it’s still fantastic and beautiful. And actually we talked about having some kind of investment property or holiday home in Europe as part of our retirement plan. And I was looking around on the internet and I came across your YouTube channel and in fact I saw the video that you did with Angelina in 2023 and I thought that looked very interesting, it sounded kind of what we were looking for and we were planning on coming to Greece going around a few islands having a look for possibly somewhere to invest in. First place we landed was in Lesvos, we met Angelina pretty much off the plane, got a really nice feeling about Lesvos, we saw in a week maybe 60 or 80 properties. It was phenomenal the amount of properties we saw. Angelina, they sound like tough clients! Yeah, so we saw a lot of properties. We really focused in on Plomari. It’s a very authentic Greek village, it’s not highly touristy, it’s unusual because it feels a little untouched by tourism.

Prices are very good in the shops, if you go for a coffee it’s you know 2 Euro, having a beer’s cheap, eating out in the restaurants is good prices, and it’s a year-round village, it doesn’t close down like some of the touristic islands. The prices of the properties were pretty cheap, you know we saw properties ranging from about 15,000 Euro and upwards. The village has not had a great deal of development and investment over the last probably 50 years, but we can definitely see things changing and moving in Plomari. We’ve been walking around on this visit, we came last year, we met Angelina, we met her team, we were very happy with the people. The numbers really worked for us, so we took a risk on redeveloping this old ruined building that was completely destroyed, just the four walls left really. But we actually grew very confident with Angelina, great project manager, full of energy, really focused on the outcome and really client-focused.

And for us trust is the major issue in any kind of deal like that as you can imagine. Managing a major restoration from the exact opposite side of the world where night is day and day is night in terms of time zones, we thought communications might be difficult but in the end actually things went really smoothly. We didn’t hit the Greek bureaucracy that you sometimes hear about, we didn’t experience any of that. Everything went very smoothly from start to finish, maybe seven months from starting on the demo to handing over the keys, fully furnished, ready to go. It was a kind of record-breaking time really, I couldn’t do that in New Zealand.

ANGELINA: My renovations in Istanbul were slower than that one!

LADISLAS: My renovation in Istanbul, especially the first one, we did in two and a half months.

JOHN: Yeah, I’m joking. So one thing that I’ve noticed, the difference between when we came last year and this year, I’m really quite surprised to see the number of developments that are happening in Plomari. You know it’s really clear to me that there’s new investments happening. A lot of the old village houses are getting restored. And Plomari’s a little different because it still retains almost all of the original housing stock from a hundred or two hundred years ago. So the village is full of period houses just waiting to be restored and there’s a lot of activity going on. I see the difference, so I definitely see an increase in investment and development in Plomari between last year and this year.

Full ROI calculation for Plomari house

LADISLAS: So let’s do the numbers. All right, so you bought a complete ruin and you changed it into two little individual homes. One house with one bedroom and two bathrooms, 96 square meters, and another house, one bedroom, one bathroom, 47 square meters. So essentially you have two listings on Airbnb. Angelina, can you take us through the price, the closing cost, the renovation cost, etc.?

ANGELINA: The price was very good, it was 55,000 Euro for this size of property, sea view, very close to the town, it’s 10 minutes walking distance there. So the closing cost 10,000, it was also included lawyer expenses, agent fee, the stamp duty and title deeds transfer. So total cost on renovation 203,000 Euro including the furniture. And the grand total, so we say total investment cost 268,000 Euro. What we say per meter square, so just renovation if you look at 203,000 Euro and divide to square meters that we renovated including the garden and area like walls around the property, it’s 1,400 approximately Euro per square meter.

LADISLAS: So when I look at this I’m seeing less than 2,000 Euro per square meter for essentially rebuilding a house including all the furniture and including all the landscaping for the garden. It’s pretty decent. Cool. So in terms of rental projections you’re expecting to get 100 out of the smaller unit and 150 for the bigger one?

ANGELINA: For the bigger one we expect 150 per day and for the smaller one 100 per day, so 250 per day for whole property. And so it’s approximately 37,500 Euro for the season. I make it roughly, so it could be more because season it’s not only four months season is here six months we still have tourists until end of October. So platform the Airbnb and Booking the booking charge 12 percent so we Airbnb less but let’s calculate 12 percent pay platform fees it’s 4,500 then property management is 20 percent we charge 20 percent for short term it’s around 7,500 per season. Cleaning is standard according to our experience is 1,100 per season. Internet is pretty good here is 40 Euro per month and you can stop for 12 months when you close the house or six months or three months when you don’t use the house and you don’t pay that expense every month. So this is very good deal. In Turkey we cannot do that. Property tax is approximately 200 Euro per year and utilities we can say electric electricity is the most expensive one 400 or 500 per year we could say. Yearly maintenance 1,250 Euro, then insurance of the house is obliged it’s pretty cheap 70 Euro. Total yearly expenses if we summarize all of this is 17,280 Euro. So net what you get in your hands after paying tax and all the profit so so your clear profit is 20,240 Euro. It is approximately seven and a half percent yearly yield return on this property.

LADISLAS: Cool. So seven and a half net yield based on these projections. In terms of taxes, generally speaking you’re looking at about 15 percent in Greece, but there are nuances here and there. I don’t want to turn this into a tax video but again one of the advantages of Greece is that it has a lot of it has a wide double tax treaty network which means that if you live in a country that has a double tax treaty agreement with Greece, in many cases you can offset the taxes or just pay in Greece and not in your country. So just speak to your accountant about this but effectively it’s pretty good. I mean you know you have a place that you can use for lifestyle that gives you some pretty good net rental yields. Prices have gone up though, Angelina, since John and Allison bought so they made a really good deal.

Before and after of the Plomari house renovation

ANGELINA: We are very proud to finalize this very special Olive House. We call it Olive House because we put olive trees, you know, they’re small but they will get bigger. I love the work that we have done, stone, marble, everything done so nicely. And we extend the entrance, entrance is wide and comfortable. The marble stairs are sage, they are all matte, no slippery. It’s very beautiful entrance to the very stunning house. I love the colors of the wall, the texture here, beautiful texture. It’s a special technique, it’s not just paint it’s thing. And so to keep the house like have the old antique style. We have two houses. I would like to show you beautiful houses. So here this is small house designed in all this beautiful Nordic style. I like fish on the wall, this is Allison and John added. And although it’s a it was always a small house it’s got everything you need, kitchen, bathroom. Small house small but has large bathroom, very comfortable. It’s a very special.

Here is a penthouse. So we created this loft floor, it was not here. The house a little bit went high maybe 20 centimeters. So we used the high ceiling and through our house we add these two windows for the lighting and created very beautiful bedroom space and everything fit in this bedroom. You have your drawers, you have your side tables, very comfortable 160 centimeter bed, 160 wide. Anyone who’s taller than me can stand here too. So it’s very nice beautiful small house, very comfortable. Only 20 plus 20, 40 square meters but everything you have in this house. All is here.

And here is the biggest house that we built, we built everything from scratches. We save some stones, it’s original stone of the house. You can see the this stone that house built from. So we created again the same style, Nordic classical style with light green colors, necklaces where you build the kitchen. It’s a country style kitchen and this bathroom also we created, it was not here with some washroom place you can say.

We like the tiles, the marble. We save, it was here and this was here, so we didn’t break these two, we saved this kind of supporting so we built bathroom by saving the space. We add marble, the tiles, everything in this style, again very light colors, no heavy colors, beautiful floor tiles. So we have the stairs, the same we restore the same style of the stairs where originally here and we created bedroom on the ground floor because here we have the garden. They have garden here with a sea view from the ground floor as well. And we add this bathroom, this bathroom was not yet were not exist, so we created this bathroom. We keep the stone wall in the bathroom with special varnish, waterproof. And of course the cabinet and mirror and sink and all accessories and tap, it’s specially designed for this house. And have small plot there.

What are current purchase prices and yield in Plomari?

LADISLAS: How much would this house be now? Not renovated.

ANGELINA: 70 or 80,000 Euro. I think with people would not sell less than 80,000 Euro.

LADISLAS: Okay. So just kind of like looking, if we switch here and we put 80,000 Euro, we increase the purchasing cost, the closing costs a little bit as well, roughly if people were to enter now and renovation costs have gone up probably about five percent since then…

ANGELINA: Renovation we can do the same, we don’t need to change renovation. All right, so people can end up with you know about six and a half, 6.8 percent yield at current entry. But we should consider something else, I sent you another calculation for 2027. So the houses in 2027 will not be the same price. So for the small house we gonna charge 120 Euro per day and for the big house 170 Euro per day. This is will be the lowest charges for for rental. Rental increasing every year, so at the end the yield will increase as well.

LADISLAS: Sure, but you know there could be an economic crisis and it doesn’t increase, so let’s just stick to these numbers to you know to be conservative. But yeah conservatively people can make six and a half, seven percent if they play their cards right.

Special tax regimes for new residents in Greece

JOHN: Another consideration for us is because we’re approaching retirement, should we choose to become tax residents in Greece, we would have the advantage of only paying seven percent income tax on worldwide income, and that’s quite an attractive feature to be in Greece.

LADISLAS: It sure beats New Zealand. Yeah, I’m paying you know 33 to 39 percent in New Zealand. So I think this just points to you know the continued exodus of Northern Europeans towards Southern Europe that have all these schemes. Right now the most interesting schemes for retirees are in Southern Italy and in Greece. And I expect more Northern Europeans to move down to Southern Italy and Greece with probably more people moving to Greece because it’s easier. English is, people speak English quite well as opposed to Southern Italy. There are more foreigners, a bigger expat community, so I would expect more influx towards Greece than to to Southern Italy.

How to contact Angelina about Lesbos Real Estate

LADISLAS: So I think this this was an interesting case study. John, Allison, Angelina, thank you thank you very much for your time. And if if anyone’s interested in potentially looking at real estate on Lesvos Island, doing renovations there, buying a ruin, something like that, there’s a link below and you can get in touch directly with Angelina.

ANGELINA: Thank you very much for your time, thank you for share this information with people. Thank you. Thank you. Make sure to download my free ebook, 12 Mistakes to Avoid When Investing in International Real Estate, which you can find on my website linked below. And feel free to follow me on Instagram @thewanderinginvestor. I look forward to hearing from you.