Letting Your Crete Home Long-Term: The Three-Year Lease, the Tax Declaration and the Way Out
A year-round tenant is the quiet alternative to holiday letting, but Greek tenancy law is written for the tenant. Here is the three-year minimum, the lease declaration on myAADE, deposits and rent increases, the 2026 tax scale and the exemption for homes moved off short lets, and what ending a lease really takes.
A long-term tenant is the calm way to let a house in Crete: no cleaning rota, no climate fee, no empty winter. It is also a contract under a law that protects the tenant, binds you for three years whatever the paper says, and only works once the tax authority has a record of it. As it stood in October 2026, checked against the laws themselves, AADE’s announcements and the state’s housing portal.
I am not a lawyer or tax adviser, and this is not legal or tax advice. A Greek lawyer should draft the lease and an accountant check the tax side before you rely on any of it.
A long-term let in one minute. A home let as the tenant’s residence runs at least three years (law 1703/1987, art. 2), whatever term is written; shortening it takes a notarial agreement made at least six months after signing. Deposit: at most two months’ rent; prepayment only for the current month. Rent rises only by a clause in the lease (CPI or a fixed percentage). The landlord declares the lease on myAADE by the end of the following month; the tenant has 30 days to accept. Since 1 January 2026 rent must reach the landlord’s declared bank account. Tax: 15% / 25% / 35% / 45% in €12,000 bands, minus a flat 5%. Homes moved off short lets or out of three empty years may be tax-free for three years (leases signed by 31 December 2026; a 2027–2030 extension was announced).
Which lets the three-year rule covers
Article 2 of law 1703/1987 is short and decisive: a lease of property for residence lasts at least three years, even if the parties agreed a shorter term or none at all. The only way to shorten it is a later agreement, made at least six months after the contract was signed and proven by a notarial deed.
Greek courts have held that a lease of a secondary or holiday home, or one written for a use other than the tenant’s main residence, sits under the Civil Code instead, where the agreed term holds, so the lease should say plainly which it is. A let of under sixty days, with nothing provided beyond the stay and bed linen, is a short let (law 4446/2016, art. 111), covered in renting out your Crete home.
The lease, the deposit and the rent
The same article sets two limits that surprise owners. Rent may be paid in advance only for the current month, so a year upfront is not lawful. The tenant’s deposit may not exceed two months’ rent, and the landlord may keep it only against unpaid sums or damage, not as a penalty for leaving early. The landlord may inspect once every three months, and an unjustified refusal is a ground for immediate termination.
According to the consumers’ union ΕΕΚΕ, a residential rent can be raised only where the lease clearly provides for it, tied to the consumer price index or a fixed percentage; with no clause, there is no unilateral right to raise it. The statutory fallback, 75% of the previous year’s cost-of-living change, applies only where a lease was written for less than three years and says nothing about increases.
The Civil Code (article 575) puts the condition of the home on the landlord: it must be handed over fit for the agreed use and kept that way for the whole lease.
The declaration on myAADE, and why it matters twice
Every lease, written or oral, is declared by the landlord by the end of the month after it starts or changes (decision A.1112/2022). Since 2 June 2025 the tenant has 30 days to accept or reject it; if nobody acts, AADE treats it as accepted (AADE’s announcement). The end of a lease is declared the same way.
The declaration matters again at the end: the repossession procedure below works only where the lease is proven by a written contract or an electronic declaration the tenant accepted. An informal arrangement costs you the fast way out. A sale does not end it either: under Civil Code article 614 a buyer steps into a lease proven by a dated document, as buying a home with a tenant in place explains.
Bank payment and the 2026 tax scale
Since 1 January 2026 rent is paid into the landlord’s bank account declared to AADE (law 5222/2025). Under article 39 of the Income Tax Code, if it is paid any other way, the landlord loses the flat 5% deduction for repairs and running costs, and the tenant loses the annual refund of one month’s rent.
Rental income is taxed separately at 15% up to €12,000 a year, 25% to €24,000, 35% to €36,000 and 45% above. The 5% is the only cost allowance, which is why the net figures in rental yields in Crete sit so far below the gross. AADE’s guidance for non-residents is that real Greek-source income means a Greek tax return, so letting the house brings one with it every year.
The exemption for homes moved off short lets
Under law 5246/2025, rent from a home of up to 120 m² (plus 20 m² for each dependent child beyond the second) declared empty in each of the three previous tax years, or used only for short lets in the year before, then let for at least three years, is free of income tax for the 36 months after the lease is signed. The window on the state’s housing portal is leases signed from 8 September 2024 to 31 December 2026; six-month leases to public-sector doctors, nurses, teachers and uniformed staff also qualify.
It is narrower than it sounds. A house bought this year has no three empty years behind it, and the law withdraws the exemption retroactively if the home goes back to short lets within the three years. In September 2026 the government announced that the measure will run for 2027–2030; in October 2026 it was an announcement, with no bill published. Ask an accountant whether your history fits before you count on it.
Ending a lease: the term, the notice, the order
A landlord cannot end a residential lease early to move in or to sell. A tenant who leaves early without serious cause owes compensation for the landlord’s proven loss, or an agreed, non-abusive penalty.
At the end of the term, the procedure in force since 1 May 2026 under law 5221/2025 is a bailiff-served demand giving the tenant three months, then a repossession order signed by a certified lawyer the court registry assigns, enforceable two months after service. The tenant can object within 15 working days. For unpaid rent it is a 15-day warning and 20 days to enforce, about three months in practice. The certifying lawyer’s fee is €300, on top of your own lawyer and the bailiff. The tenant’s side of the same rules is in renting long-term before you buy, and arranging all of it from another country is covered in managing a Crete home from abroad.
The honest downside
The law is built for the tenant, deliberately. Three years is the floor whatever you sign, the house cannot be taken back for your own summer, and even the faster repossession route leaves six months at the end. The tax falls on nearly the whole rent, and the incentive that would soften it depends on a history most new owners do not have. There is no official tenant credit check either; the owners’ federation was still asking for one in September 2026.
Disclosure: Honest Crete does not sell or list property. Enquiries sent from this section go to a licensed estate agent, not to us; the full statement is below. Nothing in this article names a developer, a property, a lawyer, an accountant, a letting agent or any other professional, and it never will.
Worth it if you will not need the house for three years or more, you want steady income with little work, and you will declare the lease and take the rent by bank from the first month. Skip it if you want to use the house yourself in summer, or the plan depends on raising the rent or recovering the house at short notice: Greek tenancy law allows neither.
How long does a residential lease last in Greece?
A lease of a home let as the tenant's residence lasts at least three years under article 2 of law 1703/1987, even if the contract names a shorter or open-ended term. It can be shortened only by a later agreement, made at least six months after signing and proven by a notarial deed. Lets of holiday homes or for another use fall under the Civil Code instead.
Do I have to declare a long-term lease to the Greek tax authority?
Yes. The landlord files the lease declaration on myAADE by the end of the month after the lease starts or changes, and the tenant has 30 days to accept or reject it; silence counts as acceptance. The end of the lease is declared the same way, or AADE treats it as still running. The accepted declaration also matters later, because the fast repossession procedure relies on it.
Can a landlord raise the rent every year in Greece?
Only if the lease says so. A Greek residential lease can tie annual increases to the consumer price index or to a fixed percentage, but without such a clause the landlord has no unilateral right to raise the rent. The one statutory fallback, 75% of the previous year's cost-of-living change, applies only where a lease was written for less than three years.
How is long-term rental income taxed in Greece in 2026?
Rent is taxed separately from other income at 15% up to €12,000 a year, 25% to €24,000, 35% to €36,000 and 45% above that. An individual landlord deducts a flat 5% for repairs and running costs, but only if the rent is paid into the landlord's bank account declared to AADE, which has been compulsory since 1 January 2026. A non-resident owner files a Greek return to report it.
Is there a tax exemption for letting a Crete home long-term instead of on Airbnb?
Yes, narrowly. Rent from a home of up to 120 m² that was empty for three years or used for short-term letting, moved to a long-term lease of at least three years signed by 31 December 2026, is free of income tax for three years. The government announced in September 2026 that the window will be extended for 2027–2030, but check that it has been legislated before counting on it.
How long does it take to get a tenant out of a house in Greece?
Not before the lease ends, because wanting to move in yourself is not a ground for early termination. At expiry, the procedure in force since 1 May 2026 needs a bailiff-served three-month demand and a lawyer-issued repossession order enforceable two months later, so about six months in practice. For unpaid rent it is a 15-day warning and 20 days to enforce.
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