The Greek real estate market is ready to welcome many new proposals as companies that manage loans secured by real estate to banks or with the funds that have acquired them are actively resuming online auctions.
According to data presented last week at the NPL forum organized by DDC Financial Group, this wave of auctions will cover between 250,000 and 300,000 properties. These assets are now considered ripe for sale through the electronic auction platform.
Speaking at the same conference, Theodoros Athanasopoulos, CEO of Cepal, one of the three largest service centers in Greece, indicated the completion of 40,000-50,000 auctions a year. Such figures, he said, “are not unprecedented for our country, as this is the number of real estate auctions held each year prior to the financial crisis in 2008.”
A return to a normal auction regime will also determine “the success of the securitization through Hercules,” he stressed, referring to the state’s asset protection scheme. This is due to the fact that the sale of assets will not only serve as an incentive for the issuance of these loans, but will also become the main source of income for service companies in order to achieve the goals that they have set for themselves in their business plans.
Their goal is to avoid cutting payments or even activating government bonds, as required by the Law of Hercules, when bad loan disbursements fall below a certain level.
According to Afanasopoulos, the automatic reduction of real estate prices without a court decision, as provided for in the draft law of the Ministry of Justice, will help auctions. However, he noted that investors need to have a clear investment policy in the real estate sector to avoid falling prices.
Interest in the management of problem loans and collateral has also attracted the attention of overseas investors. “Greece is the most active country in the securitization market,” Michalis Charalambidis, director of risk management at Hellenic Financial Stability Fund, said at the same event. He further noted that “Greek banks will account for 36% of upcoming transactions in Europe over the next few months.”