House prices post gradual correction

House prices in Greece posted a massive 170.4 percent increase in the decade from 1997 to 2007, but from the onset of the crisis in 2008 to date they have dropped by almost 20 percent, according to a report by Eurobank.

With rates for houses starting to drop from the third quarter of 2008, the reduction up to the first quarter of this year now stands at 19.8 percent, taking market prices back to levels last seen in 2005, the report signed by Gikas Hardouvelis and Theodosis Sambaniotis showed.

The price decline appears to be greater for older apartments (aged five years or over), at 19.7 percent, while newly built flats have seen a drop of 18.3 percent.

A major contraction in home sales has been recorded in the last few years, falling from 39,700 in the first quarter of 2009 to just 5,900 in the January-March period this year. Buyers? interest has shown a gradual shift to smaller and cheaper constructions, while the stock of unsold houses has ballooned.

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