House prices in Greece have plummeted 37.6 percent in real terms since the beginning of the financial crisis five years ago, according to the Bank of Greece’s Monetary Policy report issued on Tuesday.
The report also mentions that estate agencies have reported an even greater drop in prices.
Notably, the slide has been steeper in Athens and Thessaloniki, with large properties in the most expensive areas of the country being the hardest hit.
The report comments that the property market continues to be dominated by excessive supply and a significant decline in demand, which can be attributed to the dramatic increase in unemployment, the drop in households’ disposable, soaring property taxes and the instability of the tax framework.
Given the very strict terms under which credit is issued by banks, the lack of cash flow is another major factor in the shrinking demand for houses, the BoG notes.