Athens home rents plummet in all areas apart from downmarket areas in the center of the city
Olympic Games projects, the stock market bubble and the financial straits more and more sectors of the population have found themselves in since European monetary union, as well as changes in the composition of the population since the influx of immigrants, are all reflected in the home rental market. The overall picture is often contradictory – owners of small apartments in downmarket areas are demanding almost the same rents as for spacious homes in better neighborhoods. An 80-square-meter, three-room apartment in a 20-year-old building in Vlastou Street, Aghios Eleftherios, in central Athens, is going for 410 euros per month, while the rent for a 110-square-meter, four-room apartment in Constantinoupoleos Street, near Nea Smyrni park, is 440 euros. Smaller apartments, particularly in the center, are more expensive because the demand for them is higher. A studio apartment near the university campus in Zografou, in a 20-year-old apartment building, is being rented for 300 euros per month. A two-room apartment in Varnava Square, Pangrati, is 400 euros. Meanwhile, the average monthly wage in these areas is around 800 euros per month. Rents are dropping in areas inhabited by those in middle-income brackets, mainly due to a lack of fluidity but also because of improved rates for housing loans, allowing young families, who were the mainstay of the rental market, to acquire their own homes. In high-income areas, rents are stable. For example, a 120-square-meter apartment overlooking Nea Smyrni park is being rented for 710 euros per month; a new 110-square-meter apartment in the northern suburb of Papagou, 880 euros. In leafier suburbs, a house in Filothei costs 3,500 euros monthly to rent, while the owners of a maisonette in Ekali are asking for 5,000 euros, but even these areas have been forced to adapt to the changed situation following the end of the stock market boom. Between 1999 and 2001, prices in these suburbs skyrocketed by 50 percent, but the following year dropped by 30 percent. Demand is decreasing, but has not yet bottomed out. Some homeowners prefer to keep their property empty rather than negotiate rents. Higher-income groups are facing cash-flow problems, according to real estate agents in the northern suburbs. And not only the local moneyed groups but multinational companies and embassies that until a few yeas ago allowed their senior personnel to choose luxury homes are now engaged in belt-tightening. Lillian Skoura, of Elpis realtors, said that these executives generally have four or five children. «So you can imagine what sort of homes they are looking for. Embassies and multinationals used to pay the rent on these homes, which often came to a million drachmas (3,000 euros) as well as their children’s private school fees. Now they are simply paying for school fees and giving them a lump sum for rent. So, they are bargaining hard, asking for something «beautiful but cheap.» Dimitris Neamonitis, also of Elpis, added that half the homes up for rent in Ekali were empty. «There is no more cash in the banks and the euro has raised the cost of living considerably,» he said. «In the past, we could rent property in Kifissia for 12,000 drachmas (35 euros) per square meter; now we are down to 6,000 drachmas (17.50 euros). Prices should be falling further, but that hasn’t happened yet,» said Eleni Nikolopoulou, of Nikolopoulos realtors. «An outstanding unique property with a view of the Acropolis, without any aerials in the way, or with a view of the sea or greenery in the southern suburbs, can easily go for three times the market price. However, market prices are determined by average-priced properties, where the majority of people live. On the other hand, there are owners who do not want to sell at the price quoted by the realtor, and so they hang on to it. We manage about 1,000 properties. Between October and December of last year, we made 700 telephone calls. I asked the owners to explain their tactics, given that their property had been empty, without a tenant or purchaser, for at least a year. Nearly all of them replied that they were not interested in selling at current prices, as they would not be able to buy two more for their children, nor replace their former 200-square-meter apartment with a new 120-square-meter one. The same thing is happening with the rentals,» she said. Lower incomes One- and two-room apartments were typical of apartment buildings in older buildings in lower-income areas. According to Yiannis Revythis, president of the Realtors’ Union, about 15 years ago, when demand for three-room apartments emerged, contractors began building apartments of 75-100 square meters. However, over the past five to six years, there has been an increasing demand for one- and two-room apartments. The reason, according to Marianna Stavropoulou, public relations officer for the Greek Realtors’ Association, is that immigrants often live 10 to an apartment, which has sent rents spiraling upward. «Then there are more and more students, more and more divorces and single-parent families, as well as young people deciding to move out of the family home. Contractors do not find it profitable to build small apartments,» she said. «Central Athens is currently full of empty offices. I believe that if someone dared to convert these into small 30-50-square-meter apartments, they would be rented in a flash,» she added.
