Home prices in Greece have weathered the international economic downturn reasonably well and the outlook for the future is solid. According to the Second Quarter 2009 Real Estate Comment from the Bank of Greece, appreciation in home prices peaked at 13.9 percent in the first quarter of 2006 and have moderated gradually since then. The first quarter of 2009 saw a drop in Greek home prices of 1.9 percent.
The mild downturn in prices is much better than many other housing markets and is on par with Greece’s overall economy, which has also not experienced the same fall as other countries. GDP for the second quarter rose by 0.3 percent after falling in the first. Additionally, mortgage lending in the country has leveled off, rather than contracted, as in many nations. The European Central Bank data shows Greek lending for homes increased in July, 2009 by 2.3 percent over the same period in 2008.
One other factor in the relatively solid Greek housing prices is the fact that the nation did not experience the severe overbuilding that some markets did. The RICS Global Real Estate Weekly recently noted that “Looking forward, hours prices may well fall further. However, such price falls are likely to be limited in magnitude and duration given the improvements in the hard data (mentioned above) and the soft data.”
Greek consumer confidence is improving along with the overall economy, and the housing market in Greece is on a stable foundation and should benefit in the months and years to come.
Useful Resources
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