Your chance to buy property in Greece

Prices of real estate properties in Greece had dramatically increased during the last ten or fifteen years, to a point where it could be said that a lot of properties were overvalued. The reasons behind that was the overflow of money from the Greek banks to new mortgagors, the introduction in 2002 of the common European currency, the euro, and the resulting weakening of the US dollar, the rise of the Greek economy from a developing to a more prosperous status, belonging to the 25 more developed countries in the world and the evermore increased interest of Greek expatriates for land in Greece.

Tourism in Greece is prospering, with the Greek islands being one of the most desired destinations for high-income earners from all over the world. The successful organization of the 2004 Olympic Games, the promotion of incredible Greek landscapes and the Greek way of living in several international films (Mama Mia - Skopelos, Captain Corelli's Mandolin - Cephalonia, My Big Fat Greek Wedding, etc.), and the thousands of Europeans who keep choosing Greece as their holiday or retirement destination, stimulated the interest for properties in Greece. Real estate brokers in most places in Greece could not process fast enough the closings on Greek properties bought by foreigners or people of Greek background.

During the last two years, however, the tide has changed. The strong interest on Greek real estate is still there, but prospective buyers are not anymore willing to pay the high prices they were gladly paying a few years ago. What with the economic crisis in Greece and internationally, what with the weaker euro and the stronger dollar, property prices in Greece are going down, especially for someone who is paying in dollars. On top of that, the banks in Greece are not anymore giving easily loans – mortgages to local Greeks, something which had stimulated the increase in prices before.

The result is the current general trend of lower prices for properties in most areas of Greece. The market has fluctuations of course, depending on the specific part of Greece, whether it’s a city, town, island, or rural area, but the general idea is that now you can buy the same property for less. The decrease in prices is between 5 – 15% now, but there are cases where you can find properties sold even 25 – 30% less than what they were being sold three years ago. And this is only the beginning, as some speculate that prices will go even lower in the next six months, when the average Greek is expected to be short of cash and the Greek economy may show signs of “suffocation” due to the lack of money in the market.

The bottom line is that conditions like those described above may flash the green light to those who have cash and want to invest in previously expensive Greek properties, currently offered at very reasonable prices. Someone with a certain capital in US dollars in his pocket could buy property In Greece worth fewer euros a few years ago. Now, with the triple effect of the stronger US dollar, the cheaper euro and the decrease on the prices of Greek properties, the same capital of US dollars could buy you bigger and better properties in Greece, which may have sold for more euros a couple of years ago, but now may sell at much lower prices, which may lead to a profitable investment for your capital.

Christos ILIOPOULOS, attorney at
the Supreme Court
of Greece, LL.M.
e-mail: bm-bioxoi@otenet.gr