Concern over thousands of auctions in Greece is growing

Concern over thousands of auctions in Greece is growing

Increasing fears are being voiced by market players that auctions for 2020 could reach as high as 25,000, which would be favored by the removal of the protection of primary homes.

The institutions seem to have made it clear that the new framework covering both individuals and businesses should not include any kind of protection, not even primary homes, which seems to have been accepted by the Greek government. At the same time, it should provide for the liquidation of the debtors’ assets before negotiations on the settlement of their public and private debts begin.

It is worth noting that the new bankruptcy law will be based on the EU Restructuring Directive on preventive restructuring frameworks, discharge of debt and disqualifications, and measures to increase the efficiency of procedures concerning restructuring, insolvency and discharge of debt, adopted in the summer of 2019.

The relevant Directive is supposed to give a second chance to individuals who are unable to meet their debt obligations, that is, to allow for the settlement of their debts or their debt relief, after all their assets have been liquidated!

The frame

With the facts so far, the abolition of any restrictions on real estate auctions will apply universally to all debtors, even if this is the debtor’s primary home, regardless of area, income and deposits. The first debates on the new bankruptcy law, which should be operational no later than May 1, 2020, have already begun.

Government officials’ cynical statements that absolute protection of primary home is detrimental to the Greek economy have provoked strong reactions, when a similar framework exists in other countries, such as Norway or the United States, with some economic analysts and legal circles expressing their deep concern at the immediate prospect of Greece turning into Spain of previous years! Around 5,000 auctions are already scheduled for 2020, with banking officials speculating they may reach 25,000 by the end of this year. Meanwhile, some circles fear that the auction phenomenon may increase in the next few years, and could total more than 180,000./ibna