Greek real estate still in crisis

Greek real estate still in crisis

Athens, February 16, 2016/Independent Balkan News Agency

By Olga Mavrou

The prices of land and apartments in Greece keep falling –another 5% of their  value was lost during 2105. Totally, from 2008 (when the financial crisis started)  until know the prices fell by  more than 50%  -in some areas “only”  by  30% and in other areas almost by 60%. Official data from the Bank of Greece report that apartment prices fell by 5.4 percent this year and by  41,5  since 2008.

According to the European Mortgage Federation Greeks used to have one of the highest home ownership rates in EU,  that is they had 80% while the average in EU is 70%. Because of their serious financial troubles many Greeks considered selling their properties in order to come up with some cash, but that proved to be  an inadequate “solution”, since  the market  prices were extremely low. Another problem was (and still is) that the real estate market has frozen because of the big gap between the market real prices and the so called “objective values” or official values of properties  (comparable to “fair market  value” or “guiding value”). Those “objective values” (which are much higher even after the recent small adjustment) mean that no matter how “cheap” an apartment is sold, the state still demands a tax based on the high “objective value”.