Real Estate in Greece: Why House Price Growth Will Continue (Charts)

As Greece constantly occupies last place in Europe in terms of investment in housing, despite the fact that in 2022 it increased by 45.4% compared to 2020 as a percentage of GDP, house prices will continue to rise.

This is because, according to real estate professionals, the demand for high-quality properties is still strong, and at the same time, the Greek market has become a “playing ground” for foreigners, because, despite rising prices, it remains one of the cheapest in Europe. .

According to Eurostat, investment in housing construction in 2022 in Greece reached 1.6% of GDP, which is the lowest in the European Union, where the average was 5.8%, while in Spain, which is the leader, the corresponding figure as a percentage of GDP was 5.5%. And this is despite the fact that the activity of private construction has been growing in recent years, but it cannot make up for the huge gap that formed during the ten-year economic crisis.

According to the Hellenic Statistical Office (ELSTAT), for 12 months, from June 2022 to May 2023, the total construction activity based on issued building permits in the whole country amounted to 26,260 permits, which corresponds to 5,886,402 sq. m of area and 26,383,975 sq. m volume. Compared to the corresponding period from June 2021 to May 2022, the number of building permits increased by 9.2%, the area – by 0.4%, and the volume – by 2.4%.

Less than 3 dwellings per 1000 inhabitants

Deloitte’s latest “Property Index 2023” study, which analyzes the development of the residential real estate market in 27 European countries and 76 cities in 2022, also indicates a large shortage of housing. Compared to 25 countries in Europe (including Israel), Greece ranks 6th in the number of new housing units, with only 2.78 houses per 1,000 inhabitants.

Over the past year (2022), the lowest rate of housing completion was recorded in Italy (1.02 houses per 1,000 inhabitants). It is followed by Bosnia and Herzegovina and Slovenia – 1.44 and 1.48 dwellings per 1000 inhabitants, respectively.

The country with the most housing construction per 1,000 inhabitants last year was Israel (6.95 housing per 1,000 inhabitants). It is followed by Austria and Lithuania with 6.47 and 5.81 new homes per 1,000 inhabitants, respectively.

First place (from the bottom of the list) and housing stock
According to the findings of Deloitte analysts, in our country, the housing provision per 1,000 inhabitants corresponds to only 285 houses and is the lowest among 20 European countries.

Israel is in a similar situation with Greece – 295 houses per 1,000 inhabitants, followed by the UK – 371 houses. On the other hand, Bulgaria has the largest stock of housing per 1000 inhabitants – 624 houses. It is followed by Portugal and France, with 585 and 552 houses respectively.

Rising house prices
At the same time, house prices remain strong, thanks to relentless investment interest, especially from abroad, which puts aside the prospect of Greeks buying their own homes as wage growth stalls and mortgage rates rise sharply. According to the price indices of the Bank of Greece, over the past five years (2018-2023), the prices for the sale of houses in Attica have increased by an average of almost 70%.

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