House price drop seen continuing

House price drop seen continuing

There seems to be no letup in the suffering of Greek households, as three in 10 homeowners say they will be unable to pay their property taxes this year. At the same time, 40.5 percent of tenants say they are late with their rent payments, even though almost 70 percent have already seen their rental rates reduced due to the financial crisis, according to the findings of a survey by Marc presented at the Prodexpo conference in Athens.

The survey, conducted on 805 households between September 29 and October 1, found that one in three mortgage borrowers were having problems servicing their loans, although 41 percent said they have already arranged for smaller payments.

The negative expectations in the property market have been consolidated, especially regarding the gap between supply and demand. Respondents anticipate the future level of supply to be four times as big as demand, with just 4.5 percent saying they would consider buying a house in the next three years. A far greater 19 percent said they might sell a property in the next three years. Nine years ago, in 2006 the picture was the exact opposite, as 22.6 percent had been considering buying a property, against just 12.3 percent potential sellers.

About 50 percent of respondents said property prices will likely shrink further in the next two to three years, although this is a smaller rate than in 2013, when 65 percent had been anticipating a further decline. A significant 31 percent currently believes that prices will remain stable.

As to how the market could start recovering, two-thirds of respondents (65 percent) said the government should rationalize taxation on owners and improve the legislative framework. Three out of eight (37.3 percent) believe that the tax system is the biggest obstacle to attracting investors in Greece, followed by political uncertainty (27.3 percent) and bureaucracy (15.7 percent).

On the issue of properties owned by Church of Greece, the majority (63.5 percent) believe some of them ought to be passed on to the state, while 28 percent want no change.

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