Greek property prices have plunged as a six year recession has gripped the nation’s economy.
The Bank of Greece revealed the price of flats in Athens dropped by 12.6% in Q1 2013, compared to Q4 2012, and many other cities are seeing plunging prices as well.
- In Thessaloniki, the Greece’s second city, house prices fell 8.3% in Q1 2013 compared with the same quarter 12 months earlier and 1.2% compared to the previous quarter.
- In the rest of urban Greece, home prices dropped by 11% in Q1 2013 year-on-year and 2.9% on the previous quarter
- Outside the cities, the value of homes tumbled by 10.9% in Q1 2013 year-on-year and by 0.7% against the previous quarter
The Greek property market remains desperate and one of the most distressed in Europe.
Demand to buy homes is falling away fast, with the bank reporting a drop in the number of sales and the value of transactions.
Fewer than 5,000 home sales
In the first three months of 2013, the number of homes sold was 24.5% down on the same period last year, to just 4,976 from around 6,630.
The Bank of Greece also revealed the value of outstanding mortgages was down 4.9% to £62 billion.
To try to boost the market, the Greek government has offered expats from outside the European Union willing to move to the country a five-year residence package for the expats and their families, providing they buy or rent a home worth more than £215,000.
The depressed house market is a sad reflection of the boom times after the 2004 Olympics which pushed prices up around the country and even in the islands and Crete.
Prices have continued to drop for six years in a row, and the problems of lack of finance, unemployment and recession show no sign of abating as the government imposes austerity measures that have seen thousands of public servants lose their jobs.
Free fall
Worryingly, prices are dropping faster now than at any time during the financial crisis and look nowhere near bottoming out.
House prices are still in free fall in Spain – dropping by more than 13% in the past year on top of plunging by more than a third in recent years.
In total, Spanish homes are now priced at around 64% of their value at the peak of the country’s property market in 2007.
The figures come from the Council of Notaries, the lawyers who witness property transactions.
