In the second quarter of 2021, amid improving economic conditions in the country, property prices in Greece increased by an average of 4.6%.
In comparison, in the first quarter of 2021, an increase of 3.5% was recorded.
The trend, according to many real estate experts, will continue until the end of this year and and even the next year due to the strong recovery of the economy.
In turn, according to the Bank of Greece, the highest demand for housing was recorded in Athens. At the same time, prices here in the second quarter of 2021 increased by 6.4% compared to 5.6% in the first three months of 2021.
A number of incentives recently introduced by the Greek government have helped spur growth in this sector. For example, a reduction in property tax for ENFIA.
However, the key factor driving prices up is the economic recovery after a sharp contraction last year due to the pandemic and several lockdowns.
Data released by the Greek Statistics Office this week shows that Greece's economy grew 16.2% year-on-year in the second quarter of 2021, beating economists' expectations.
Improved sentiment among consumers and investors supports the positive momentum in the real estate market. Bank lending to the sector is also gaining momentum.
Senior representatives of the Bank of Greece emphasized that the rise in house prices, most likely, is in sync with the pace of GDP growth. For 2021, economists are revising their forecast for Greece upward, tilting growth by about 5-6%. This figure is expected to grow at a similar pace next year.
On the other hand, however, risks to the Greek real estate market remain, including the uncertainty caused by the pandemic and weak labor market conditions that hinder the ability of households to take out new mortgages.
Further evaluation of the data for the second quarter shows that the rise in prices for new apartments (under five years old) reached 4.7% and 4.6% for secondary housing.
It should be noted that apartment prices in the rest of the country rose 3.2% in the second quarter of 2021, compared with a 1.6% increase in the first three months of the year.