Hello everyone!
Passover is behind us, and Operation “Lion's Roar” is entering its second month, with fuel prices rising around the world and with them transport and raw material prices, which will push up the construction input index and apartment prices. The Bank of Israel left the interest rate unchanged at 4.0%, noting that “in the Committee's assessment, the risks of a renewed rise in inflation have increased.” In other words, the Governor said that “we are in a very different cycle from the central banks of the world,” and stressed that interest in Israel is relatively high compared with rates around the world. The Governor therefore noted that the rate may still come down 1-2 times. Until then, apartment buyers will most likely continue to “sit on the fence.”
This month we would like to draw your attention to:
A. The Greek economy: a move to a new phase.
B. Thessaloniki: “doors are locking” in the city center.
C. Romania: an analysis of real estate market trends.
D. Cyprus breaks the European tax trend.
E. The Cypriot land authority tightens protection for buyers of “off-plan” apartments.
F. The “green renaissance”: a 65% subsidy for energy renovation becomes the lifeline of second-hand properties in Italy.
G. Portugal: the amendment to the housing laws and the comeback of the rental market.
H. The end of the “Golden Visa” era in Spain.
Adv. Ilan Leibovitch and the office team
Greece
The Greek economy: a move to a new phase - moderate forecasts, downside risks
March 2026 brought with it a series of macroeconomic updates on Greece that cannot be ignored. The two most credible economic bodies on the international scene, the Bank of Greece and the International Monetary Fund, issued updated forecasts for 2026 in that same month, and both point in the same direction: a controlled slowdown, but with risks tilted to the downside.
The Bank of Greece: 1.9% - and a necessary update
On March 20, 2026 the Bank of Greece published its latest assessment of the country's economy. The growth forecast for 2026 was cut to 1.9%, after standing at 2.1% in the monetary policy report published in December 2025. The main reason for the cut is not an internal failure but an external shock: Europe is dealing with a significant negative energy shock as a result of the war in the Middle East, and the effect on the real economy and on inflation depends on the severity and duration of the conflict.
Inflation is expected to remain high at 3.1% in 2026, with risks to the growth forecast tilted to the downside. Among the main factors: further escalation of the conflict in the Middle East, rising global economic uncertainty, growing trade barriers and stubborn inflation.
The broader context is also worth noting: in 2025, Greece's economy showed growth of 2.1%, significantly outperforming the eurozone average of 1.4% in that year. That is, Greece's starting point going into the slowdown is relatively positive.
The International Monetary Fund: 1.8% and a medium-term view
On March 24, 2026 the International Monetary Fund (IMF) published the conclusions of its 2026 Article IV mission. Growth is expected to fall to 1.8% in 2026, with high energy prices and weak external demand related to the conflict in the Middle East likely to weigh on private consumption and on the tourism sector.
Over the years, stable GDP growth of about 1.5% is expected against the background of a declining working-age population, a low labor-market participation rate and slow productivity growth. This is a figure that medium-to-long-term investors need to take into account.
At the same time, the Fund also notes prominent positive aspects: the debt-to-GDP ratio fell by about 10 percentage points in 2025 to about 145%, a marked decline from the peak of about 210% in 2020. Credit to the private sector expanded by 5.3% (over 12 months) in January 2026, mainly thanks to strong demand from corporations.
Economic sentiment: a sharp decline in services and among consumers
The Economic Sentiment Indicator (ESI) for March stood at 106.8 points, down from 107.6 in February - a figure that reflects a halt, and perhaps even a reversal, of the positive trend observed in recent months. The sharpest decline was recorded in the services sector, where the index plunged to 27.1 points from 32.4 in February, and consumer confidence also continued to deteriorate.
According to the IOBE economic sentiment survey, the drop in consumption became the dominant factor behind the slowdown: in retail, sales expectations deteriorated sharply as inventories rose, hinting at a slowdown in demand. At the European level, the decline in the relevant indicators reaches double digits compared with the start of the year.
The March 2026 data show that Greece is entering a different phase - not a bad one, but a different one.
From the writer's desk:
First, it is important to separate the internal Greek story from the external noise. The slowdown does not stem from a disintegration of economic fundamentals - Greece continues to grow faster than the eurozone, government debt is falling at an impressive pace, and the banking system is in good order. The pressure comes from outside: the Middle East war, energy prices and weak external demand, factors to which no European economy is immune.
Second, analysis of the sentiment indicator offers an important insight for real estate investors. The sharp drop in services and among consumers is not just a number - it heralds a potential slowdown in tourism and in discretionary spending. For those investing in short-term rentals, and especially outside Athens and the popular islands, this is a warning sign that it is worth re-examining income forecasts.
Third, in an environment of moderate growth, flaws are exposed. When the market rose quickly, one could “live” with a partially registered property, an unreliable tenant, or tax that was not properly managed. In an environment of 1.8%-1.9% annual growth, the gaps between a well-managed investment and an investment built on optimistic assumptions will become visible and painful.
And finally - even in a cautious market there are opportunities. Investors who now devote time to in-depth checks, legal certainty and data-based financial analysis are the ones who will use the lull to position themselves before the next wave of growth. Greece is not disappearing from the map; it is only asking its investors to be smarter.
Thessaloniki 2026: “doors are locking” in the city center
From March 1, 2026, new regulations took effect from the Greek Ministry of National Economy and Finance (in coordination with the tax authority AADE), imposing significant restrictions on short-term rental activity (Airbnb) in central Thessaloniki.
The main regulations and registration restrictions:
- A freeze on new licenses: there is a complete ban on issuing new property registration numbers (AMA numbers) for short-term rental within the boundaries of Thessaloniki's first municipal community (1st Municipal Community): the historic and commercial city center, including the central axes (Tsimiski, Egnatia), the Aristotelous Square area, the Ladadika district, the port area and the waterfront promenade, and the Ano Poli district.
- Duration of the restriction: the regulation was set for an initial period of 12 months (until March 2027), with the government authorized to extend it according to indicators of residential housing availability in the area.
A restriction on license transferability upon sale:
A central, new provision in the regulations states that in the restricted areas, the short-term rental license (AMA number) is not transferable upon sale of the property. Properties with an active license issued before March 1, 2026 may continue operating under the current owner only.
- Upon transfer of ownership of the property (sale), the existing license is automatically cancelled.
- The new buyer will not be permitted to issue a new AMA number for the property for as long as the freeze is in effect.
Our media coverage
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Romania
Analysis of real estate market trends
The Real Estate Index review by the firm Deloitte and Romanian Ministry of Finance data published this month point to a stage of “structural balancing” in the local real estate market.
According to Deloitte's comprehensive developer survey, there has been a marked change in economic expectations in Romania relative to the past year:
- The overwhelming majority of developers in Romania (54%) estimate that the level of market activity will remain stable in the coming months, while 29% expect a moderate improving trend.
- Economic forecasts point to inflation converging to the central bank's (BNR) targets, which creates an expectation in the market of gradual interest rate cuts during the second half of 2026. This move is expected to lower financing costs and improve market liquidity.
Despite demand, the Romanian market is dealing with supply challenges stemming from changes in the costs and availability of land:
- Construction costs: for the first time in two years, construction costs (27%) and difficulty in acquiring land (25%) were marked as the main barriers to developing new projects.
- A decline in construction starts: a drop of about 20% in new construction starts was recorded during 2025 (according to NSI data), a fact that creates built-in pressure for price increases in the medium term because of an accumulated shortage of new housing units and modern commercial space.
The Romanian government continues to invest in infrastructure that anchors logistics and commercial real estate development:
- The A0 ring road project: a budget allocation of 1.2 billion lei was approved in the last week of March for continued development of sections of Bucharest's express ring road. The opening of these sections is expected to raise land values in the outer ring of the capital (Ilfov County) and to improve access to logistics centers.
Cyprus
Cyprus breaks the European tax trend - a capital gains tax (mas shevach) exemption as a response to the regulatory tsunami
While most European Union economies are looking for ways to increase state revenue by making real estate taxation heavier, the Cypriot Parliament this week approved a strategic legislative amendment intended to attract sophisticated foreign capital. The move, which grants a full exemption from capital gains tax under certain conditions, puts the island on the upside against the worrying trends in the rest of the continent.
The new legislation in Nicosia sets a precedent: 0% capital gains tax on the sale of residential properties in projects defined as “supporting the knowledge-intensive industry” (Tech-Supportive Housing). The exemption is intended for investors who buy properties in residential clusters adjacent to technology development hubs and hold them for at least 5 years.
Unlike other countries where capital gains tax is a rigid component of ROI, Cyprus uses it as a tool to encourage the Headquartering model, which brings to the island multinational companies and thousands of employees with high purchasing power.
Beyond capital gains tax: Cyprus's competitive advantages in 2026
While capital gains tax is the “cherry on top” at exit, Cyprus offers further structural advantages that become especially critical in the current quarter:
- Immunity from rent control: while Barcelona, Paris and Berlin tighten control over rental prices, the Cypriot market remains completely free. For the investor, this is protection of ongoing cash flow against government intervention.
- Bypassing the “energy trap”: the May 2026 deadline for implementing the European energy directives (EPBD) turns millions of old properties in Europe into “toxic assets” requiring expensive renovation. In Cyprus, most investment projects are new construction pre-rated Class A, which spares owners heavy CapEx expenses and ensures better bank financing terms.
- Regulatory certainty: while countries in Central and Eastern Europe (such as Poland and Hungary) advance legislation to limit the purchase of multiple apartments by foreigners, Cyprus is strengthening the legal standing of the foreign investor as an integral part of the national strategy.
The 2026 real estate map places the Israeli investor at a crossroads: chasing cheap prices in Eastern Europe under a growing tax burden, or choosing the liquidity and fiscal certainty of Cyprus. The new capital gains tax exemption is proof that while Europe becomes “regulatory,” Cyprus remains “business-minded.”
The Cypriot land authority tightens protection for buyers of “off-plan” apartments
The Cypriot real estate market has been undergoing in recent months a significant regulatory transformation, placing it at the forefront of transparency and consumer protection in Europe. The government land authority (DLS - Department of Lands and Surveys) has begun strict enforcement of new regulations as part of an amendment to the Cypriot sales law, intended to give airtight protection to buyers' money in projects under construction.
The end of the “trapped buyers” phenomenon
The change is intended to solve a historic failure, in which buyers discovered at the handover stage that the property they bought was mortgaged to the developer's loan, with no ability to obtain ownership (Title Deed). Under the new guidelines that took full effect in 2026, the DLS imposes a technical reporting and execution obligation that cannot be bypassed in the contract registration process.
The “Form A” mechanism: the tiebreaker on the ground
From now on, every developer seeking to register a sale contract at the land registry offices is required to present two critical key documents:
- An updated land registry extract (Search Certificate): a document issued no later than five business days before the signing date, showing the up-to-date registration status of the land.
- A lender's declaration (Form A): in cases where the land is mortgaged to a bank, the developer is required to present an official document signed by the lending financial institution. In this form the bank undertakes in writing that upon deposit of the buyer's funds into a dedicated account, the specific housing unit will be released automatically and absolutely from any encumbrance on the land (what in Israel is known as a conditional “exclusion letter,” mikhtav hacharaga).
Digital enforcement and sanctions
The main innovation lies in the DLS electronic registration system. The system now blocks the possibility of registering contracts that do not include these documents. In addition, the authority has been granted the power to impose administrative fines of up to 10,000 euros on developers who fail to present the required proper disclosure before signing.
Italy
The “green renaissance”: a 65% subsidy for energy renovation becomes the lifeline of second-hand properties
The Italian government has officially launched the “Superbonus 2.0” scheme, which grants a tax credit of 65% for renovation and energy upgrade expenses on residential buildings. The move, which took effect against the background of growing pressure from the European Union to implement the EPBD directive, marks an exceptional opportunity for value enhancement for property owners and foreign investors in the country.
The new scheme is focused on properties rated at the lowest energy efficiency levels (Class G/F), those that make up most of the apartment stock in the historic cities and in southern Italy. According to the new regulations, eligibility for the subsidy is conditional on an improvement of at least two grades in the property's energy rating. The recognized expense ceiling stands at 96,000 euros per housing unit for structural and insulation works, with additional budgets for smart heating and air-conditioning systems.
The timing of the bonus launch is no coincidence. By May 29, 2026, Italy is obliged to transpose into national law the European Union's stricter MEPS standards. This means that properties that do not meet a minimum efficiency threshold in the coming years may suffer “regulatory depreciation” and become hard to sell or rent because of the new bank financing restrictions.
Beyond the physical enhancement, upgrading the property through the government subsidy opens for the owner a door to preferred financing routes. Leading banks in Europe have recently begun offering “green mortgages” at significantly reduced interest rates for properties rated A-D, which is expected to increase the property's liquidity on the day of sale and attract a wider audience of buyers.
From the writer's desk:
For investors and property owners in Italy, the current window of opportunity is critical. Using the 65% tax credit makes it possible to protect the invested capital and upgrade the business model from an ordinary income-producing property to a modern, economical and regulatorily safe property. It is advisable to carry out an updated EPC (Energy Performance Certificate) check in the coming weeks in order to examine the feasibility of an upgrade under the new scheme.
Portugal
The amendment to the housing laws and the comeback of the rental market
Portugal's real estate industry experienced in March 2026 the most significant amendment in a decade. After a period of aggressive legislation (the “Mais Habitação” law), the government and the legal system completed the “great amendment” that restores certainty to the market. For existing property owners and potential buyers, this is a dramatic change to the bottom line.
1. Defusing the financial landmine: what the CEAL tax was and how was it abolished?
The most substantive change is the complete abolition of the CEAL (an extraordinary levy on accommodation units).
- What was it? A fixed annual levy of 15% calculated on the basis of a complex formula that combined the property's area, its geographic location and the estimated average income in the area.
- The economic meaning: this tax did not apply to net profit, but was a fixed levy that eroded the gross yield at a rate of 10%-20% (depending on the property).
- The new status: starting with the 2025/6 tax returns, the CEAL has been struck from the record. Investors in Airbnb properties go back to paying only regular income tax, which lifts the net yield by an average of about 2%-3% a year.
2. The gap between city and periphery: where does taxation meet regulation?
With regard to direct taxation of income (IRS), Portugal today offers uniformity, but with a notable advantage for those who choose long-term tracks:
- Nationwide: tax on short-term rental income (Airbnb) remains on the standard track, but without the CEAL levy.
- The difference in 2026: the government has introduced a “green tax” track of only 10% tax (instead of 25%-28%) for those who choose to rent the property long-term (over two years).
- The key distinction: in the periphery (low-density areas) the road is open for investors with 0 euros of tourist fees. By contrast, in Lisbon and Porto you will pay tourist fees of about 4 euros per night and increased municipal taxation. These steps are intended to “push” you to give up Airbnb and move to the residential rental track, where you will pay only 10% income tax (instead of about 28% on the regular tracks).
3. The battle of the licenses (AL): Lisbon and Porto versus “the other Portugal”
Here lies the heart of the regulatory change in 2026. The country has shifted power to the municipalities, and the result is “two countries for two markets”:
In the big cities (Lisbon, Porto and the Algarve coastal strip):
- Obtaining a new license: still very difficult in Containment Zones. In historic neighborhoods such as Alfama or Baixa, it is almost impossible to obtain a new license.
- License renewal: the automatic renewal obligation every 5 years that was in the original law has been abolished. Now, an existing license remains valid as long as the property owner complies with local regulations.
- License transfer (sale): this is the weak point in Lisbon - the license is personal. On the sale of a property in a Containment Zone, the license usually expires and the new buyer has to submit a new application (which may be rejected). Therefore, a property with an existing license in Lisbon is a “gold property” as long as it is not sold.
In the peripheral cities and the interior (Interior):
- Perpetual licenses: licenses in 2026 in these areas are permanent and do not require renewal.
License transfer (sale): unlike Lisbon, in most peripheral cities the license passes with the property to the new buyer. This means the property is sold as a “going concern,” which raises its exit value by tens of percent compared with a regular apartment.
From the writer's desk:
The Portuguese market in 2026 requires more precise planning than before from the Israeli investor:
- The value of “seniority”: if you have a property with an active AL license in Lisbon or Porto - do not sell. Thanks to the abolition of the license expiry every 5 years, your property has become a cash-generating machine with an enormous barrier to entry for new competitors.
- The new road map: for those looking for a new short-term purchase (Airbnb), the focus shifts to second-tier cities (such as Coimbra, Aveiro or towns on the Silver Coast) that are defined as “low-density” areas. There one can obtain a perpetual license, transfer it on sale, and enjoy the abolition of the 15% CEAL tax.
- Hedging risk through long-term rental: for Israelis seeking peace of mind, the 10% tax track on long-term rental in the big cities offers a net yield that competes with Airbnb (because of the lower management costs), with full regulatory protection.
Bottom line: Portugal in 2026 is a market for the well-informed. The big winners are those who already hold properties in the big cities, and those who will know to buy in the developing periphery under the new licensing rules.
Spain
The end of the Golden Visa era in Spain: the Supreme Court ruling and the first market data reveal a new reality
A year after the law abolishing the real estate route of the “Golden Visa” (Organic Law 1/2025) took effect, the end of March 2026 marks the final closing of one of Europe's most popular investment routes. For the Israeli investor, this is not only a regulatory change but a rare market opportunity that arose precisely out of the new restrictions.
The Supreme Court ruling
In recent weeks the Supreme Court in Madrid (Tribunal Supremo) rejected the last petitions filed by developer associations and international investment groups. The petitioners argued that property rights and freedom of occupation had been harmed, but the court held that the state has full authority to restrict foreign residency in favor of the “national housing interest.” This ruling removes any legal doubt that was still hanging in the air and makes clear: the 500,000-euro route will not return in the foreseeable future.
Real data: a contraction in the luxury market
The first-year summary report published this month by the Spanish Registrars' Council (Colegio de Registradores) reveals the depth of the move's impact:
- A drop in foreign demand: in the segment of properties above 500,000 euros, a decline of 14.2% was recorded in transaction volume by citizens of non-European Union countries (Non-EU) in the main demand hubs - Madrid and Barcelona.
- The price effect: while general housing prices in Spain continued to rise (about 9.5% in 2025), luxury properties that previously served as an “entry ticket” to the visa are now experiencing stagnation and even isolated price declines in direct negotiation.
The Spanish paradox: a social failure, an opportunity for the investor
The verified data of the Ministry of Housing (MIVAU) show that the original goal of the law, lowering housing prices for locals, was not achieved, since Golden Visa transactions made up less than 0.5% of the entire market. However, for the Israeli investor (and especially holders of a European passport or those who do not need a visa), a window of opportunity has emerged:
- Unprecedented bargaining power: sellers of premium properties have lost the “captive audience” of visa buyers (Chinese, Americans and Russians).
- Cleaning out the “visa premium”: prices today reflect pure real estate value, without the artificial addition that the immigration benefit previously embodied.
Accurate as of the issue date. Laws, tax rates and procedures change; check the current position before any decision.
Translated from the Hebrew original. עברית