Greece: house prices in freefall
Further fall of 10-15% expected this year
Leftris Potamianos, the owner of the "Seek and Find" estate agency in Athens and treasurer of the association of estate agents for Athens and Attica, says that the fall in prices particularly affects transactions operated through estate agents.
"While requested prices were around 10 or 15% below previous years, final prices often fell by a further 10% after negotiations," Potamianos explained to the Athenian newspaper Kathimerini. However, the estate agent continued, the most significant drop was registered for old homes, where the urgent financial needs of the sellers in some cases was the driving force in transactions.
On the other side of the market, the number of transactions involving new properties carried out by construction firms last year was very low, though most firms, particularly in the fourth quarter of the year, showed some signs of light recovery after constructors lowered their initial requests.
Overall, though, transactions throughout the country are estimated to have dropped by 50% compared to the previous year, following understandable hesitation by buyers, whose spending power is lower, and by banks whose refusal to sanction mortgages is in stark contrast with their generous policies of previous years.
All of these factors are expected to remain in place for the current year, given that the next few weeks are likely to be crucial for Greece's economic future. If the outcome is positive, experts say that prices could begin to stabilise from the second half of 2012, though such a scenario appears to be more of a pipedream than a realistic prospect. Either way, prices are set to fall further in the first half of this year, with a further drop of between 10 and 15% on 2011. As a result, potential buyers with liquidity will have the chance to buy property at prices significantly lower than those of 2008.
As market experts point out, the measures launched by the government to tax property but also to increase yields on land have delivered a crushing blow to the property market. "It is inconceivable in this particularly negative climate, both for the general economy of the country and for the property sector, that there should be talks of increasing the value of owned land to be used for fiscal purposes," commented Yiannis Perrotis, chief executive of the estate agency CBRE Atria.
Saturday, 4 February 2012
(ANSAmed) - ATHENS, JANUARY 31 - The effects of the economic crisis that has rocked Greece for the last three years is being felt significantly on the property market. Based on transactions in the sector over the last year (considered the worst to date), experts say that house prices, for both old and new homes, have decreased by between 20 and 30%.
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