July 19, 2024

Athens News

News in English from Greece

Real estate: renovation from 500 to 1000 euros per square meter

Recent years have seen a boom in property renewal, both in urban centers and in the periphery or popular tourist destinations. The pandemic and subsequent lockdowns gave the owners the opportunity to redecorate.

However, given that the main obstacle is financial difficulties, a significant part of citizens wishing to update and modernize their properties are actually unable to do so, increasingly relying on financial schemes.

Exoeconomics programs (Εξοικονομώ) subsidize part of the costs and at the same time provide the opportunity to finance on favorable terms, promoting the energy modernization of old properties and increasing their value. In fact, according to the Ministry of Environment and Energy, most of the work is carried out under these programs.

The need to renew the country's housing stock is highlighted by the findings of a recent analysis by the National Bank of Greece, which found that during the economic crisis the country's housing stock has deteriorated so much that thousands of homes are now considered uninhabitable and “pushed out” of the market.

In particular, during the decade 2012-2022, almost 250,000 homes deteriorated significantly, reducing their marketability. Likewise, most properties built before 1980 that will be at least 50 years old in 2030 have not been modernized or renovated, with investment in building maintenance and renovation over the past decade estimated to have fallen short of the €35 billion needed to maintaining the value of existing buildings. In this regard, market participants are ringing the bell, emphasizing that additional measures are required to finance the necessary investments.

“A drop in the sea”

In a conversation with NEA, the President of the Panhellenic Federation of Real Estate Owners (POMIDA) Stratos Paradias emphasizes that renovations are necessary, whether we are talking about aesthetic and functional interventions or energy savings, which – according to him – will become mandatory. “All this is happening at an unfortunate time, because, on the one hand, we have a constant increase in prices for materials, and on the other, difficulties in finding craftsmen.”

He calls Execonomo's programs a “drop in the bucket” because, he says, “the real needs are enormous and the availability of funds is negligible.” All the programs are delayed, and the artisans brought in to implement them either ask for all the money until they collect it from the state, or say: “Leave the programs and I will repair them for you without bills,” he says. However, he admits that a certain impetus was indeed given to the market, but this did not apply to a critical mass of citizens. “There were a lot of people who wanted to take part in the programs, and then they were disappointed. They found that everything was not so rosy, because a lot was required. money for a down payment, etc.”

Costs over 50%
From a practical point of view, despite the apparent increase in the number of renovations, it turns out that owners are choosing smaller scale jobs and using lower quality materials. As Yiannis Petropoulos, head of the technical bureau, notes, “prices for building materials have skyrocketed, and costs have increased by more than 50%. If in the recent past the average price per square meter ranged from 300 to 350 euros, today it has exceeded 500 euros, reaching even 1000 euros in more expensive areas.

Major renovations that require a minor renovation license include demolition and remodeling, replacement of frames, plumbing and electrical wiring, plumbing and kitchen equipment, and timely completion of repairs is delayed due to difficulties in finding available crews. For example, if someone wants to renovate a house of 100 square meters. m, then the delivery period starts from three months, but depending on individual problems the time increases.

At the same time, prices for construction materials are rising (by 5.6% in February), their growth was recorded in all individual categories, with the exception of diesel fuel and electricity. In particular, prices increased for brick (15.6%), safety glass (10.9%), plastic, synthetic, fiber cement pipes (8.6%), radiators (7.6%), copper pipes (7.5% ), marble tiles (7.5%), built-in wardrobes (7.1%), parquet (6.7%), cement (6.3%), floor tiles, wall tiles (6.3%), aluminum frames (6.1%), ready-made concrete (4.9%), plastic, acrylic, water-based paints (4.8%), wooden windows (4.3%), interior doors (4%), copper pipes (3. 9%) and iron fittings (3%). Prices decreased only for electricity (1.1%) and diesel fuel (0.7%).

Exoeconomics programs
It is worth noting that recently the government has launched a package of measures aimed at subsidizing or encouraging energy saving. They are part of an overall plan to reduce energy consumption and therefore costs for households, businesses and the public sector. In addition, in the second half of the year, the announcement of a new program “Exoeconomics 2024” (“Εξοικονομώ 2024”) is expected, the model of which will be completely different from the current energy modernization program and programs of previous years. For its implementation, at the first stage, 700 million euros have been allocated from ΕΣΠΑ and €170 million from REPowerEU. Within the framework of “Exoeconomics 2023”, the second round of applications for energy insecure households ended on March 29, in “Exoeconomics – Business” (Εξοικονομώ – Επιχειρώ) the application deadline is March 31, and “Engineering Changes for Business” (Αλλάζω συσ κευή για τις επιχειρήσεις” ) continues until the budget is exhausted. Finally, in the next period, the launch of the “Photovoltaics for Business” program is expected.

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