ECONOMY

Index to shed light on property prices

Greece’s central bank will launch a real estate price index to better measure the course of property prices and help cover the need for a credible benchmark, it said yesterday. While housing represents about 25 percent of all investment in Greece, the lack of reliable data and information on the industry has hampered decision-making, according to Bank of Greece Governor Giorgos Provopoulos. «In Greece the largest part of wealth is held in property, affecting households’ propensity to spend and save,» the country’s central bank governor said. «This has an impact on economic activity and inflation,» Provopoulos added. The Bank of Greece recently set up a real estate analysis department to collect and process relevant data. Data presented yesterday showed that house prices in the country have fallen 7 percent since the beginning of the global economic crisis last year. Based on EU Commission statistics, construction accounted for 10.7 percent of gross domestic product in Greece last year and for about 8.7 percent of total employment. Greece has one of the highest homeownership rates in Western Europe at 80.1 percent versus 70.4 percent in the European Union as a whole, according to European Mortgage Federation data.