BUSINESS

House prices set to decline further in 2014

By Nikos Roussanoglou

House prices in Greece are set to slide anew in 2014, extending the crisis in the property market for one more year, according to an annual market report by Eurobank.

Its baseline scenario foresees a 6 percent price drop and a rebound from next year, while the extreme scenario provides for a 12 percent slump in prices and a return to growth in 2016.

The study also draws attention to the remarkably steep rise in prices – more than 200 percent – between 1997 and 2008 (i.e. an annual growth rate of 10 percent), which was followed by a decline that the Bank of Greece has found to amount to 38 percent from end-2008 up to 2013.

Fitch Ratings is forecasting that house prices will post a total drop of 42 percent before they start to rebound.

The International Monetary Fund had predicted in a recent report that the market crisis will last for six-and-a-half years and bring about a price slide equal to 45 percent since 2009.

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