The new challenges in the real estate market, as they are shaped after the war in Ukraine, the increase in energy costs and the wider inflationary pressures, are at the heart of assessments made by professionals on the course of the market.
In his estimates released by Ioannis Revithis, an economist-real estate appraiser, member of the Board of Directors of the Federation of Greek Realtors and former president of the Federation, says the real estate market is expected to clear up in the coming months as it absorbs the effects on the broader economy with a significant delay of 8 to 10 months.
“However, the existence of inflationary trends, combined with the limited supply of housing, is keeping demand high. Research in the Greek property market shows that there is increased interest in properties in urban centres, while almost six out of ten prospective buyers are increasingly interested in apartments rather than detached houses.
Part of the Ukrainian refugees that Greece is estimated to absorb will boost the demand for apartments,” he estimates.
“If the two sides get along and in the short term, market and rental indicators will be up in the centre of Athens, where we have a high transport network near squares and areas more residential than commercial.
Once again, these data align with the shift in preferences towards city centres and business hubs as the Greek economy changes and young professionals returning to Greece and working in stable jobs in technology prefer residences that are close to transport (e.g. metro, suburban rail) and business hubs. Many investments in the Greek residential market are still coming from abroad,” he says.
He also expects that there will be a lot of mobility in the luxury residential market involving properties in tourist areas. In particular, citizens from Northern Europe as well as citizens from North America and the Middle East are the ones who will drive the real estate market upwards.
Increased demand for the Southern Suburbs and the centre of Athens
Demand is concentrated in the southern region of Attica, in the centre of Athens, and will certainly start in the northern suburbs of Attica, which have been left behind, and all the islands of our country.
So, despite the instability, whose duration remains unknown due to the war in Ukraine, it is estimated that the real estate market developments, if they have a quick end, will give a boost and upward momentum to the Greek real estate market by funds, investment companies, developers and foreigners, says the member of the Federation of Greek Real Estate Agents.
Revithis believes that the main concern for the real estate market is basically energy costs, which may force some to either slow down or postpone the realisation of property development projects they have underway, the continuation of which would be unprofitable and loss-making.
A wait-and-see attitude therefore prevails for stakeholders, as well as for sellers, whether private or developers. The latter are adopting a wait-and-see attitude with regard to the sale of houses, as well as to barter agreements, because the costs of building materials have shot up by 20 to 100%, due to events, the increase in oil and the increase in shipping fares. Because, with an uncertain final construction cost, they cannot be bound either by a pre-contract or a definitive contract for properties that have not completed construction, Revithis believes, among other things.
He also refers to rental prices, which, he points out, are at their highest levels in a decade. Mainly in newly built, up to 10-year apartments – maisonettes and the reason is that the decade-long recession of the real estate market – construction can not catch up with new construction, the existing demand. Most tenants are not changing their in good condition homes, builders prefer to sell the newly built properties rather than rent them, he adds.