ECONOMY

Olympic works still shape Athens property market

One year after the Athens Olympics, the infrastructure works associated with this major event are still setting the pace in the capital’s housing market. Most of the buying public’s interest is concentrated in areas of Athens which have benefitted from road projects such as the Attiki Odos and Hymettus ring road, as well as those linked to the metro – despite the significant price rises on this land. This improved access has made it easier for people to commute to the city center from greener and more spacious neighborhoods, which are often in the suburbs. At the same time, neighborhoods with lower prices are also quite popular; the cost of a mortgage may remain low, so a loan – even for the entire amount – is an easy option. However, households’ disposable incomes are under pressure, making the tier of 110,000-160,000 euros the most popular, with a small number of buyers rising to 200,000 euros. From these prices it becomes obvious that for the best section of the demand the key price is around 2,000 euros per square meter (sq.m.). In this context there is strong demand in cheaper areas despite the rising costs in the last couple of years. The common denominator, though, is that the forthcoming changes in real estate taxation have created unrest in the market and increased worries among potential buyers, resulting in some problems and limited price rises. According to the head of the housing department of Danos & Associates, Thanos Karayiannis, the areas standing out this year to date are the cheap ones, which many consider as downgraded. Areas such as Aghios Artemios, Petralona and Sepolia have in recent years recorded significant price rises, 20 percent on average, but are still trailing the average in purely residential areas. Neos Cosmos also has a particular momentum thanks to the metro and its proximity to the city center. «What I realize from everyday contact with the public is that in the capital what an average family forks out today to buy a house in the traditionally residential areas is not enough, which is why people seek alternative solutions in cheaper areas, always in the 85-100 sq.m. size range,» Karayiannis says. «Interested buyers with more than a quarter of a million euros for a house have diminished, and this is predictable as those who have the money already have a house, while from an investment point of view there certainly are better options than housing.» He goes on to say that «beyond cheaper areas, there is interest in the Attiki Odos ring which includes Kantza, Glyka Nera and Fourezi, where prices range from 2,000 to 2,100 euros/sq.m. Access is now perfect, the zoning is good and allows for green space creation and total permissible built areas are reduced. These areas offer good living conditions and, despite the big rises, they remain affordable as they have started from low levels.» But he believes that Athens city center may have everything but is not worth it: «The population keeps rising, demand is too big compared with supply and prices are comparatively high for what it offers.» Big capital gains The choices of the president of the Constructors’ Association of Greece, Dimitris Kapsimalis, are focused around the three subway lines’ stations. «The fixed-route transport means have created new housing markets with impressive capital gains due to the high demand that followed,» Kapsimalis says. «Areas like Halandri or Vrilissia are recording rises of 15 to 20 percent, with the average rate at 3,000 euros/sq.m., while at Gerakas prices have gone up from 1,800 to 2,500 euros/sq.m.» He says there were similar developments in Pefki, Maroussi, western Athens (Peristeri) and Sepolia, where newly built houses now reach up to 2,500 euros/sq.m. «Also interesting are western Attica areas, mainly Korydallos and Aegaleo, and I believe that if plans for Elaionas materialize then Tavros and Aegaleo will enjoy considerable capital gains,» Kapsimalis suggests, making a special reference to Ilion, «an area that is being reborn and is characterized by impressive price increases. It is now hard to find a newly built house there at a price below 2,000 euros/sq.m.» As for future prospects, Kapsimalis is hesitant: «I cannot single out any areas as the overall picture and the map have now been consolidated and will not be easy to change again. Some extensions of the suburban railway, if its operation proves successful, may hide some opportunities, with Pallini being my favorite for that.» Eastern Attica Alekos Koukas, formerly at REDS and now co-founder of the new consultancy and property services firm Immoconsult, does not hesitate to single out the eastern Attica areas: «The changes made in the region through the new infrastructure works are indeed impressive and have helped areas like Pallini, Glyka Nera and Pikermi emerge; they are still showing high demand this year.» He explains that those changes combined with the saturation from dense structure in traditional suburbs such as Aghia Paraskevi and Holargos are turning a huge portion of demand to the Mesogeia region in eastern Attica, «focusing on apartments and maisonettes up to 100-120 sq.m.» Koukas, however, makes it clear that the imposition of value-added tax and the coming increase of officially determined values has created an artificial surge in demand, spread today according to every area’s characteristics. «For instance, western Attica has its own traditional public who have lived there for years and are seeking a better and more modern house or are buying one for their children,» he says. «Hence, although it is a densely populated region, it continues to enjoy high demand.»