BUSINESS

Recovery of property prices in Greece expected to continue

NIKOS ROUSSANOGLOU

TAGS: Property

Property prices in Greece have recouped 4.2 percent of the ground lost during the financial crisis, thanks to the steady course of recovery over the last 18 months.

Property rates shrank 42.4 percent from the third quarter of 2008 to that of 2017 , but have started to show signs of a rebound since the start of 2018, according to a survey titled “The Prospects of the Property Market in Greece” by Tasos Anastasatos, chief economist at the Eurobank group.

Bank of Greece data show that the pace of growth has been increasing, starting from 0.5 percent and reaching up to 7.7 percent, which was the national expansion rate in April-June 2019 on an annual basis.

In Attica, where demand is stronger, prices shot up at an annual rate of 11.1 percent in Q2, which is even higher than the rates recorded during the property boom of the 2002-2007 period. In Thessaloniki, prices rose 7 percent in the spring, while in other major cities the increase reached 4.1 percent and in the rest of the country it came to 4.9 percent.

Even so, Greece lags considerably compared to the other bailed out states in the European Union that saw property prices sink. In Spain for instance, house sale prices declined 35.3 percent during the economic crisis, but have since rebounded by 15 percent. In Ireland the drop exceeded 53 percent, but the rebound has come to 34 percent, while in Portugal prices did not drop that much (by just 13.3 percent) and have now become even higher than before the crisis, rebounding by 33.5 percent.

Transactions in Greece are also on the rise, according to figures from the database of the Independent Authority for Public Revenue, with last December posting a spectacular 65 percent increase from the December 2017.

All signs are pointing to the continued growth of house prices as gross domestic product, employment and private consumption are also on the rise: The economy has been growing for nine consecutive quarters and is projected to expand further, private consumption is edging up after losing 39 billion euros from 2008 to 2017, and the unemployment rate has been in a steady decline since the third quarter of 2013.

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