House prices likely to fall, but some areas are coveted

Ongoing major improvements in the road network in the Attica region around Athens continue to exercise a strong pull for real estate investors and are bound to have a significant impact on the market in coming years. However, the market overall is not on the upswing and prices are projected to fluctuate considerably, largely according to the particular characteristics of individual areas. According to realty consultant Nikos Yiannoulelis, residential property prices are expected to decline on average by 20 percent in the 2004-2007 period. He insists, however, that certain areas will gain. House prices around the center of Athens seem to be recovering impressively after sliding for two decades, with demand focused on smaller apartments. «Public transport projects, mainly the tram and extensions to the underground metropolitan railway, are improving access to many neighborhoods and upgrading the center, where traffic is also expected to be decongested with the peripheral roads coming into service. At the same time, efforts to improve the picture of the city are boosting interest in certain areas, such as the pedestrianization of the southwest side of the Acropolis, although no one is selling there yet,» says Yiannoulelis. The development is affecting neighboring areas, he adds. Further interest is noted in the center of Piraeus, where prices have declined markedly in recent years, as well as in the western suburbs where the quality of residential properties has been upgraded. The Mesogeia area to the east of Athens, where prices have risen steeply mainly due to the Attiki Odos highway leading to the new airport, is expected to remain in the spotlight. The president of the Greek Property Brokers Federation, Yiannis Revythis, says for every area there are different buyers with varying requirements. «Mesogeia is a good option for cheaper freestanding houses, while demand is expected to rise due to the many jobs being created in the area. Low interest rates are keeping the loan option attractive and prices are unlikely to rise much given that they are already high. The prices of big and luxury houses there and in the center of the city have not undergone a correction and are likely to remain where they are,» he says. The president of Property Construction Association, Dimitris Kapsimalis, notes strong demand in the areas near the airport, the metro and urban railway stations and in the northeastern suburbs of Halandri, Aghia Paraskevi and Vrilissia. Outside Attica, he notes opportunities in the towns of Halkida and Corinth, while the mountainous area of Arcadia in the Peloponnese has attracted British investment interest in tourism.