BUSINESS

Banks plan to buy back properties sold at auction

YIANNIS PAPADOYIANNIS

TAGS: Property, Banking

Banks intend to repurchase a large part of the properties they will auction off, aiming to ensure the efficient operation of the new online system and prevent a dramatic drop in property prices that would have an impact on their financial reports.

According to the banks’ plans, between 8,000 and 10,000 properties of all categories will go under the hammer in the coming months and the lenders – depending on the general economic climate – are planning to absorb up to 6,000 of them to avoid a shock effect on the property market.
Real estate assets constitute collateral for mortgages and other loans, so any price fluctuations can have a significant impact on the value of collateral and the banks’ finances.

Credit sector officials say that the first online auctions will finally take place in late November or early December. Banks expect this to contribute toward containing strategic defaulters who do not meet their obligations, making the most of the system’s inertia to date.

Bank sources also note that the 10,000 properties to go up for sale online will not be small ones or the main residences of debtors, but large properties.

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