It will take at least two or three years before the local property market emerges from the deep crisis of recent years due to the weight of the excessive supply and the lack of demand, according to an economic conjuncture survey by the Athens University of Economics and Business.
In contrast to some forecasts for a market recovery from 2015, conditions in the sector are continuing to deteriorate. The survey showed a fresh decline in market confidence from 30.37 in the previous survey to 29.60 points, with 50 points representing the border between optimism and pessimism.
Most market professionals (87 percent) believe the crisis will last up to three more years – i.e. until 2017 – with the main reason being the huge stock of unsold properties that are estimated at between 200,000 and 270,000 across the country. Such a high supply is impossible to absorb given the current demand, or lack thereof. Contributing to this lack of demand are the high unemployment rate, the lack of financing by banks, high taxes on property and the low birthrate, the university’s survey argued.
Of the experts questioned, 95.8 percent said they thought the market is suffering from oversupply, while 88.4 percent believe that prices have dropped further in the last six months. Five out of six (83 percent) said that prices will slide to lower levels in the first six months of 2014, with one in six seeing a steep drop.
Just 10.1 percent of respondents expect demand to recover in the period up to the end of June, with 28.9 percent expecting no change in the demand levels. The majority (61 percent) believe demand will sink to a new low.
Another survey by Remax Athmonon estate agents showed that even in the upmarket northern suburbs of Athens, more than half of the property transactions (56 percent) were conducted at rates below those used for tax purposes, known as “objective values.” Maroussi was the municipality with the highest number of transactions, of which 33 percent were conducted at prices 20 to 30 percent below the objective values.
The same survey showed that the share of properties which do find buyers ranges between 3 and 11 percent of the supply, depending on the area.