
The medium-term and long-term expectations for the Greek real estate market remain positive, according to the Bank of Greece’s Monetary Policy report, although in the first months of 2022 it is under the influence of negative forces.
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The strengthening of positive expectations is reflected in the values and the low, in proportion to other periods of increased uncertainty, yields of income properties.
Besides, as mentioned, the higher real estate values, investment mobility and the strengthening of construction activity recorded in 2021 still leave their mark on the market.
Uncertainties
However, significant uncertainties affect real estate directly. These include direct pitfalls such as increased construction and energy costs, but also indirect threats, such as the possible effects of geopolitical instability and inflationary pressures on tourism and investment activity, Such uncertainties may lead the real estate market once again to “sit tight”, especially in the case of investments in new real estate development projects.
“Conditions for the short-term maintenance of the dynamics of the Greek real estate market are the gradual de-escalation of the geopolitical crisis, but also the restoration of the smooth operation of supply chains after the disruption that was a consequence of the health crisis and which has not yet been fully brought under control. However, it is pointed out that, especially under the current circumstances, further significant interventions are necessary to simplify and speed up the processes of transfers, investments and real estate development in order to support the market and ensure its current momentum,” the report from the Bank of Greece emphasizes.
The housing market
The housing market continued to see upward price trends, during 2021 and in the first quarter of 2022. Based on estimates collected by credit institutions, nominal apartment prices in the first quarter of 2022 increased on an annual basis by 8.6% (provisional data), while for 2021, based on revised data, apartment prices increased at an average annual rate of 7.4%.
From the analysis of the data according to building age, during 2021 and the first quarter of 2022, stronger growth rates are recorded for new apartments (up to 5 years old) compared to old ones (over 5 years old).
In particular, in the first quarter of 2022 the prices of new apartments rose significantly at an annual rate of 10.3%, against 7.4% for older venues, while for 2021 the corresponding increases were 7.9% and 7%. As concerns geographic region, high annual rates were recorded in Athens (9.7% for the first quarter of 2022 and 9.4% for 2021) and Thessaloniki (8.3% and 7.2% respectively), mainly due to intense investment interest.
Construction
In the first months of 2022, in addition to values, other indicators related to the housing market remain positive.
In particular, in the first two months of 2022, Hellenic Statistical Authority-ELSTAT’s housing construction activity index continues to increase, registering an average annual increase of 35.7% in terms of volume.
The Foundation for Economic & Industrial Research – IOBE’s index of business expectations for home construction, during the first five months of 2022, marked an improvement compared to the corresponding period of 2021 (64%).
Foreign investments
In the first quarter of 2022, net foreign direct investments in Greece for the real estate market recorded an annual growth rate high (74.8%) reaching 374 million euros.
The burden of construction costs
Residential investment is up 18.6% year-on-year in the first quarter of 2022, but is still at a low level as a percentage of GDP (1.4%). New mortgages remain low despite a significant increase in the Q1 2022 quarter on an annual basis.
Among the negative indicators is the total cost of construction of new residential buildings which, based on ELSTAT data, increased in the first quarter of 2022 on an annual basis by 7%, although the market places it much higher.


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