Thousands of owners of small plots of land in settlements of less than 2,000 inhabitants are suddenly faced with an unpleasant reality: their properties, which were previously considered within the plan and suitable for building, are now in danger of being turned into plots of land without building rights. The reason is the publication of the new Presidential Decree (PD) for the demarcation of the country's settlements (Government Gazette D 194/15.04.2025), which applies the case law of the Council of State (CoE), redefining with stricter criteria the boundaries and categories of residential zones.
With the new categorization, many areas that until now were considered within the boundaries - based on decisions of Prefects - are declassified, as these decisions were considered as partially arbitrary and the Prefects are not suitable for such decisions as they lack the relevant scientific training. Now, only demarcations made through an approved urban plan and approved by a PD are considered valid. All others are considered to be "up in the air", causing legal and financial uncertainty for owners.
The essence of the problem is not only the formal recognition of settlement boundaries. It concerns thousands of families who had invested or planned to build a house on a small plot of land in their village - plots of 300 or 400 square metres, which were within county boundaries and now risk losing their building rights for good, unless they exceed 4 hectares, as provided for off-plan areas.
The chronicle of an urban bomb
The problem is not new. As early as the 1980s, the majority of small settlements in Greece (about 12,000 in number) were demarcated not by Presidential Decree, but by simple administrative decisions of the Prefects. These decisions were repeatedly ruled by the Council of State as unauthorisedly issued, as the Constitution requires that an approved urban planning and PD must precede them.
Typical examples:
- Decision 56/2017: cancellation of settlement boundaries in Rethymno
- Decision 1268/2019: Cancellation of boundaries in areas of Pelion
- Decision 164/2022: Cancellation of extensions of settlements in Paros
In all cases, the reasoning of the CoE was similar: extensions or demarcations without urban planning are considered illegal and cannot be the basis for the issuance of building permits. The 2025 PD comes to apply this jurisprudence on a nationwide level, distinguishing settlements into zones (A: historical core, B: coherent parts, B1: scattered) and excluding Zone C, which included disputed land.
The first reactions: Local communities and landlords on the edge
The first reaction came from Crete. The Union of Property Owners of Heraklion Prefecture (ENIDANI) sent a letter to the Minister of Environment Stavros Papastavrou, expressing the anxiety of citizens. The president of ENIDANI and vice-president of POMIDA Kostas Arapoglou warned of massive devaluation of properties, as happened with the abolition of derogations in off-plan building in 2020 (Law 4759/2020).
"These rapid and unfavourable developments clearly violate the provisions on property protection, both of our Constitution and of all international treaties to which our country has acceded", POMIDA said in an official statement.
The owners' associations stress that this is not just a technical problem, but a question of survival of small settlements. The building ban causes depopulation, increases homelessness and makes it more difficult to house public servants and seasonal workers in areas where housing costs are already high. At the same time, they fear a blow to real estate investment and the granting of Golden Visas.
The reactions on the political scene: New Democracy in introversion
The crisis is not limited to the social level. It has already caused political tension within the New Democracy. New Democracy's local government officials are pushing hard for changes, as - they say - citizens are seeing their property lose value. The Central Union of Municipalities of Greece (KEDE) with a unanimous decision expressed its disagreement with the ID and requested a meeting with the Ministry of Environment. The issue is taking on the dimensions of a "national crisis of small property", with the Southwestern Democratic Party's Central Committee being on the "rails" and the Ministry in a defensive position.
Environment Minister Stavros Papastavrou, speaking to ERTNews, claimed that "order is being brought to a decades-old pending issue" and added that the ID does not eliminate but preserves legal certainty. However, political attrition is visible and several MPs are talking about a "blunder" in the midst of a difficult period for the government.
What the government is planning: The Peri-Residential Zones Window
Faced with the pressure, the Ministry of Environment is preparing new legislation. At the heart of the solution are Peri-residential Zones (P.O.Z.), special areas that will function as a continuation of settlements at a distance of up to 500 metres and will be defined through Local Urban Plans (LEPs). There, building conditions will be more favourable than off-plan (e.g. for properties over 1 hectare), but stricter than on-plan.
The president of the Greek Technical Chamber, George Stasinos, proposes to allow building on properties of at least one acre: "You can build some specific square meters and be considered off-plan, but by way of derogation you can build some houses," he said in the podcast "Babel" of ot.gr. He warned of a "sudden death" of building, which will lead to greater desolation of the countryside.
The ministry, however, says that no change will be implemented immediately without consultation, and is committed to bringing the relevant regulation to a vote soon.
Next steps and unanswered questions
The regulation currently being drafted is expected in the next ten days in Parliament. However, many questions remain unanswered: Which areas will be included in a P.O.Z.? How will the 'functional relationship with the residential fabric' be judged? Will there be provision for properties of less than one hectare?
The crisis revealed the huge institutional gap in the spatial planning of small settlements, but also the mismatch between the legal system and social reality. Small landowners, local communities and municipalities are calling for a solution that does not sacrifice legal certainty in the name of bureaucratic rigour, nor does it allow the arbitrariness of the past.
Greece has the opportunity to finally resolve a decades-old problem in a fair, sustainable and realistic way. Whether this opportunity will be seized remains to be seen.
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