BUSINESS

Residential construction still suffering

NIKOS ROUSSANOGLOU

TAGS: Economy

Construction in Greece has been hit hard by the financial crisis as the divestment seen in the last decade has been unprecedented.

Just 288 million euros was invested in residential construction in the second quarter of the year, which is shockingly low when one considers that when the market was at its peak, in 2007, Alpha Bank recorded the same amount being invested in just three days.

Consequently, investment in residential construction accounts for just 0.6 percent of gross domestic product in the first six months of this year, which compares with 11 percent in 2007, when the sector was a crucial pillar of the economy, along with tourism and shipping.

The total loss of capital from the economy from 2008 to 2016 is estimated at almost 24 billion euros. Recent figures by the Hellenic Statistical Authority, that Alpha cited in its report on the sector, showed that in Q2 this year investment in the housing market dropped another 5.1 percent from April-June last year, while the annual decline in the whole of 2016 had come to 12.6 percent. The drop amounted to 25.8 percent in 2015 and 53.3 percent in 2014.

The last year Greece saw an annual increase in investment in residential construction was 2007, in the second quarter of which investment had amounted to 8.1 billion euros.

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