Decline in property prices expected to continue

According to real estate experts, a relative equilibrium between supply and demand in the Greek housing market is predicted around the end of 2012 or early next year.

Panos Danos, head of Danos however, ?it must be made clear that the lack of transactions does not necessarily make for a steep fall in prices but simply for a freeze in the market,? Danos says.

It has become clear over the last two years that buyers are increasingly turning toward older homes. According to data in a report by RE/MAX estate agents, 77 percent of houses and apartments sold in 2011 were older than five years and one in three was older than 30 years. In Attica, sales of homes older than 30 years approached 42 percent and in Thessaloniki 48 percent. By contrast, 25 percent of buyers went for new constructions — up to five years old — enticed by the considerable discounts offered by developers.

Data concerning the size of properties sold through RE/MAX last year are a good reflection of the economic crisis. The most popular category concerned apartments in the 71-90 square meter range, at 22 percent, while 20 percent were in the 51-70 sq.m. range. In Attica, properties of up to 110 sq.m. in area represented 77 percent of sales, of which 27 percent were in the 71-90 square meter category.

Danos notes that the crisis is producing buying opportunities as owners offer considerable discounts. Indeed, most aim to simply meet the remaining part of their mortgage loan and pay it off rather than make a profit.

On the other hand, in order to attract buyers, developers often deduct VAT from the sale price and discounts can amount up to 35 percent.