Realty prices slightly up, buyers in waiting mood

Property sales, in data collected and processed by Aspis Real Estate (ARE), a chain of realty agents, are reporting satisfactory demand and a continued slight rise in prices for newly built apartments in the first nine months of the year. Between January and September 2007, ARE closed 795 property deals in the Attica basin, regarding exclusively newly built apartments. In the same period last year, the number of deals closed by ARE stood at 605, showing an increase of 31.4 percent in this year’s property deals. Similarly, significant changes are also apparent in sale prices. Characteristically, the mean increase in prices for central Athens stands at 12.5 percent, with a similar rate recorded in the western suburbs, followed by the northern suburbs with 12.3 percent and the southern suburbs with 11.2 percent. The rise in Piraeus stood at 9.0 percent and in eastern suburbs at 6.0 percent. Based on the above data, Aspis Real Estate has concluded that demand is satisfactory and prices are moving up. Unrepresentative data However, the ARE data do not seem adequate for safe conclusions with regard to property price developments. In fact, a closer look at the data shows that in some areas the price rises are outrageous. In fact, the price hikes of 61.1 percent in the areas of Anoixi and 25 percent in Ambelokipi in the first nine months of 2007, year-on-year, appear to be explained by the fact that the company this year sold better and hence more expensive properties in the specific areas than last year. But ARE data seem to be more credible with regard to demand for newly built apartments, even if taken as a mere sample. In the first nine months of 2007, ARE’s network had not expanded to such a degree that could justify an increase in sales of 31 percent compared to the same period a year earlier. «I do understand that the data we presented stand in contrast to the real estate market’s current picture, but this is a reality as recorded by our network, which in 2007 was enhanced only by four branches,» Miltos Epithymiadis, ARE managing director, told Kathimerini. He added that a large part of demand «is in a wait-and-see mode» for a clearer picture as regards property taxation. «But this applies primarily when referring to expensive properties, given that in low-priced areas buyers move quickly to purchase a property once it meets their needs and requirements.» Epithymiadis also said that another 300 property contracts are in their final stage, of signature, and that only 200 deals were made in the first nine months of 2007 regarding «previously lived-in» apartments. «Data for the first nine months of the year show satisfactory growth in the property market in Attica. Buyer interest has been steady, with no exclusions or irregular moves,» said Epithymiadis. With regard to prices, upward trends seem to be slight and may be seen as justifiable considering the increases in construction costs, construction companies’ higher operational costs, inflation and higher loan costs. Interestingly, however, the continued upward trend in prices is offset by bank competition, absorbing increases and helping to sustain market vitality. «The market’s short-term growth would depend on an array of factors, including new taxation measures, interest rate moves, and, of course, government decisions over the setting of an increase in officially set property values [for tax purposes], expected to be announced in the early days of next year. A positive thing would be for those pending issues to be settled as soon as possible,» Epithymiadis said.