Greece Real Estate Trends: Buying Older, Pricier Homes

Examine the shift in Greece's real estate market as buyers now prefer older, more expensive homes compared to the 2008 market peak.

In contemporary Greece, a notable shift in the housing market has emerged, characterized by a proclivity among buyers to invest in older and comparatively more expensive properties than those available during the peak of the real estate boom in 2008. Current sale prices for homes in the Attica region have surged by 4% relative to 16 years ago, a trend that has been particularly pronounced since 2017. However, this increase in price is juxtaposed with a significant decline in the quality of properties being purchased. In 2008, the average home acquired by Greek buyers was between 20 to 30 years old; today, the average property is a staggering 40 years old. This stark contrast suggests that, despite the higher financial outlay, buyers are securing homes of inferior quality compared to those available in the pre-crisis era.

These insights were unveiled during the annual Prodexpo real estate conference by Vasiliki Vlachostergiou, the deputy head of the Real Estate Market Analysis Department at the Bank of Greece (BoG). Compounding this issue is the alarming statistic that, since 2008, real household incomes have plummeted by 20%, thereby exacerbating the challenges associated with home acquisition. The data clearly indicates a significant shortfall in quality housing options to satisfy the demands of households. To illustrate, the number of building permits issued in the singular year of 2005 is comparable to the total permits granted from 2011 through the onset of 2024.

Moreover, the escalation of home sale prices has outpaced wage growth to a considerable degree, rendering property acquisition a formidable challenge even for those seeking loans. Many prospective buyers are now compelled to explore more economical alternatives. Historically, purchasing a home was a familial endeavor, often bolstered by substantial familial support—be it through monetary gifts or the liquidation of an existing property. However, in the aftermath of the financial crisis, this familial safety net has diminished significantly, and the availability of real estate for sale to facilitate new purchases has dwindled.

Simultaneously, official statistics reveal a troubling decline in homeownership rates, which have plummeted to a historically low level. Once exceeding 80% during the 1980s and 1990s, homeownership dipped to 75% in the early 2000s, experienced a slight uptick to 77% by the decade's end, but has now descended to a mere 69.6%, according to the latest Eurostat data for 2023. In Athens, this figure is even more disheartening, with estimates suggesting that homeownership does not surpass 64-65%. The implications of these trends are profound, raising critical questions about the future of housing accessibility in Greece.