Greek real estate market: The new challenges – What will affect the real estate market

New challenges in the real estate market, such as those posed by the war in Ukraine, rising energy costs and wider inflationary pressures, are at the heart of assessments made by professionals in the market.

In his assessments published by Ioannis Revythis, economist-real estate appraiser, member of the Board of the Hellenic Realtors Federation and former president of the Federation states that the real estate market is expected to clear up in the coming months, as it assimilates the effects of 8 to 10 months. “Nevertheless, the existence of inflationary trends, combined with the limited supply of housing, keeps demand high. Research in the Greek real estate market shows that there is increased interest in real estate in urban centers, while almost six out of ten candidates “Buyers are increasingly interested in apartments instead of detached houses. Part of the Ukrainian refugees, which Greece is expected to absorb, will increase the demand for apartments,” he said.

“If the two sides find each other and in a short time, market and lease indices will be up in the center of Athens, where we have a high transport network near squares and areas more residential than commercial. Once again , these elements are in line with the shift of preferences to city centers and business hubs, as the Greek economy changes and young professionals returning to Greece and working in stable jobs in technology prefer homes close to transportation “(eg metro, suburban) and business hubs. Many investments in the Greek housing market still come from abroad,” said Mr. Revythis.

He also estimates that there will be great mobility in the market of luxury homes related to real estate in tourist areas. In particular, citizens of Northern Europe as well as citizens of North America and the Middle East are the ones who will lead the real estate market upwards. The demand is concentrated in the Southern region of Attica, in the center of Athens, it will definitely start in the Northern Suburbs of Attica, which are behind, but also all the islands of our country. Thus, despite the instability, the duration of which remains unknown due to the war in Ukraine, it is estimated that the developments in the real estate market, if they have a quick end, will give impetus and upward pace to the Greek real estate market by funds, investment companies, builders and foreigners. says the member of the Federation of Brokers of Greece.

Mr. Revythis estimates that the main concern for the real estate market is mainly energy costs, which may force some to either slow down or postpone the implementation of their ongoing real estate development projects, the continuation of which would be unprofitable and harmful. There is therefore a waiting attitude for those interested, as well as for sellers, whether individuals or manufacturers. The latter are holding a wait-and-see attitude regarding the sale of houses, as well as the compensation agreements, because the costs of building materials have skyrocketed from 20 to 100%, due to the events, the increase in oil and the increase in shipping fares. . Because, with an uncertain final construction cost, they can not be bound either with a pre-agreement or with a final contract for properties that have not been completed, Mr. Revythis estimates, among other things.

It also refers to rental prices, which, as he points out, are at the highest levels of a decade. Mainly in the newly built, up to 10 year old apartments – maisonettes and the reason is that the ten year recession of the real estate market – constructions can not catch up with the new constructions, the existing demand. Most tenants do not change their homes in good condition, builders prefer to sell the newly built properties rather than rent them out, he adds.

What will affect the real estate market

For his part, Babis Charalambopoulos, former president of the Hellenic Institute of Valuation, former Certified Appraiser and scientific advisor of SOLUM Property Solutions, estimates that after the ten-year economic crisis, the pandemic waves and the war in Ukraine, the market real estate and in particular the market of all types of buildings (apartments, houses, villas, cottages, offices, shops and logistics) as soon as we return to a new regularity, will be rearranged and will start from a new base.

In his assessments, he emphasizes a number of factors that exist and shape the scene in the real estate sector. Among other things, it refers to the war in Ukraine, the energy crisis, the cost of all types of fuel and transport, the demographics of the country that affect the number of required homes, but also their size and the trend (created by the pandemic) for work from home that leads to the demand for small space in the home in order to be serviced. It also refers to the needs of office spaces that are differentiated, because working from home changes the landscape. According to Mr. Charalambopoulos, the issues that will shape the developments in the real estate market are the need to modernize a significant part of the housing stock through renovation, energy upgrades and, where necessary, anti-seismic reinforcement. The course of the real estate market will be determined by foreigners who come to Greece to work remotely for a company based abroad and looking for a home, either with a long-term or short-term lease.

Mr. Charalambopoulos also refers to the “green” office buildings that are in great demand, a fact that has pushed developers in the construction of several such buildings that are in various stages of construction, while others are planned to be erected when the landscape clears and normalizes. cost of materials and labor. It also emphasizes the Logistics buildings, which due to the pandemic (there was a big shift in e-commerce) but also the upgrading of the ports of Piraeus and Thessaloniki, are a magnet for AEEAP and other investors.

In the new normality we will have, among other things, forces that push the market upwards but also other serious forces that act in the opposite direction. So we are in a transitional phase with two trends. These two trends over time (depending on the duration of the war and the energy crisis), will create a new base that will vary depending on the city, location, size of the property, its quality and condition. , its antiquity and other characteristics, he appreciates. And he adds: Many of the properties that are now, due to red loans, in the hands of banks or funds, after they mature, will also enter the offer and thus will affect to one degree or another the prices and the rents. New buildings are few and if they are in good places, they meet sufficient demand. So there we have growth trends. On the other hand, the very large increase in construction costs and all the turmoil that exists at the moment, has led to a postponement of the construction of several new buildings.

He also appreciates, among other things, that
– The older constructions, if they are in good places and have the appropriate size, are usually requested, if the price is reasonable, because the buyer will also allocate money for the modernization.

– In our internationally renowned islands, such as Mykonos, Santorini, Rhodes, Corfu, Paros, the demand comes from foreigners and prices will move upwards, but at reasonable levels. The holiday home will meet some demand from foreigners, such as in northern Greece there is a relative demand from Romanians, Bulgarians and other Balkans for small and relatively cheap houses near the sea, while other places are of interest, ‘British, German, Arab, Chinese, Israeli and other buyers. This demand also appears in short-term leases, especially for spring, summer and autumn. We will see how this market is restructured.

In times of crisis, owning real estate is safer than some other assets.

Source: AMPE