Report: Europeans Buying Up More Real Estate in Greece
All the more Europeans appear to be investing in real estate in Greece, primarily driven by affordable prices, prospects of rental income, political stability and economic growth, according to a report released this week by property brokers Tranio.
According to the report citing National Bank of Greece data, foreign direct investment in Greece real estate came to 736 million euros in the first two quarters of 2019, compared to 415 million euros in foreign real estate investment in 2017.
This year, Q2 apartment prices increased by 6 percent compared to Q4 2018, marking the sharpest growth in the sector in more than a decade. The report goes on to note however that despite the six-month rise, the current prices are 36 percent lower compared to 2008.
At the same time, according to Nordea statistics, direct investment from the eurozone accounts for 70-80 percent of annual foreign property investment, with leading buyers hailing from the Netherlands, Luxembourg, Germany, France, Belgium, Italy, and Spain.
The increased activity is driven, according to Tranio analysts, by apartment and home purchase affordability, the price-to-rent indicator which found that an investor buying a central Athens apartment and leasing it will see return on investment in 20 years; and the availability of rental income which has grown significantly in Greece due the surge in inbound tourism.
The report notes that tourism is driving the annual growth rate of the short-term rental sector by 25 percent and generating roughly 2 billion euros annually for property owners, leading to rising rental rates and property prices. In 2018, the average rental rate in Athens grew by more than 9 percent.
Other factors contributing to the stronger interest in the Greek real estate market include, the steady growth of Greece’s GDP, political stability and the announced government plans to reduce taxes – including property tax – and foster a friendlier investment environment.