Is Greece real estate market still attractive?

From recent reviews it looks like Greece real estate market is overstated.

The high supply and the high prices combined with rising interest rates almost bring the real estate market to a standstill.

In one word the market does not move and the demand is very limited.

Especially the newly build apartments in Greece are so expensive compared to the average income that it makes it difficult to buy.

The picture of Greece today’s housing market can be characterized by low volume purchase and sales, limited demand and oversupply.

Even the exemption for the first home given by the government hasn’t been able to stimulate the demand for housing.

That means at least for now that the prices will stay high because the real estate developers argue that they have bought the land for very high prices and they will not make a profit if they lower the costs of the properties. On the other hand the small real estate developers have to lower the prices if they want to stay on the market. The big development companies will be able to keep the prices because of the high liquidity gained in the recent years. Let’s not forget that in 2005 the real estate market in Greece was booming and the real estate market wheel was rolling.

The biggest deficit is to be found in the new housing market, as 60% of the transactions involve second hand homes.

The owners of second hand houses are usually selling in order to buy a new apartment, and because the prices of the new apartments are high they mistakenly ask a much higher price for their properties than the real value, so in this is making it difficult to sell or buy.

The lower price they ask for their second hand home the more are chances that will ever be sold.

Usually the owners have to lower the price with up to 25% in order to have a chance of selling.

As I said before in one of the recent articles there is a pretty much similar situation in Bulgaria and it will pretty soon start in Romania, as the land is getting more and more expensive, and the real estate developers are excessively  building new apartments and houses.

So be cautious if you decide to invest in Greece. I’m sure there still are few bargains, but I don’t believe that anyone can still strike gold. Oh, if you would like to move to Greece, by all means, do invest in property. Greece remains one of the most beautiful countries in Europe.