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Collective
situation report ,of the Greek real estate market
by George Sitaras , HAR GREECE
 The
situation of the Greek Real Estate market ,appears
unexpectedly to be stable, despite the heavy problems with the
downturn of the global economy. The absence of institutional
investors ,is the problem of the Greek house market. The status of
the quid pro quo and the system of the objective-commercial values
,does not leave much room for activation, resulting to the lack of
large development. In parallel, the complicated urban planning status
and the lack of unoccupied land enc(a)umbers the procurement of large
areas. The institutional investors do not do business with “black”
money and as a result they can not compete with the so called “small”
constructors who dominate the Greek market. Concerning the prices,
only in extreme circumstances we will witness a big fall and this is
because the available land continuously reduces. Preparative to deal
with the current situation, the constructors do not enter to new
constructions and they await absorption of the existing apothems,
which is happening, but in slow rhythms. Furthermore,
the works are constructed with the same capital and as a result ,the exposure to lending is very low.
Any
problems
that
exist
to
other
countries,
affect
us
less,
with
mostly
indirect
consequences.
So,
we
observe
the
fact
that
in
one
of
the
weakest
economies
of
E.U.,
the
real
estate
market
displays
resistance,which
partially
results and from its primitive structure.
Comparatively
to
the
international
circumstances,
2008 was
a
satisfying
year
for
the
whole
country. However, the characteristics of a two-speed market appeared:
-
The
large cities and a large part of continental Greece, where the
demand was reduced and the prices remained stable or reduced by
approximately 10% and
-
The
tourist destinations - including the islands, where stability
prevailed regarding the prices and a small reduction of the demand.
The
buyers
face
the
offers
with
skepticism,
procrastination ,but
they
usually
get ahead ,when
they
carefully
weighttheir
decision. Also,
a
reduction
on
the
demand
of
foreign
buyers
is observed, although there is an increase on the demand for larger –
more expensive residences, mostly in the tourist destinations.
An
important
factor,
is the difficulty the banks face to finance the house market. Even
if
the
Greek
buyers
traditionallydid
not
borrow
in
order to buy their residences, the last years they adjusted to rest
of the western world and in some cases the financing reached the 60%
- 70% of the purchase.
The
administration of loans , has been considerably constricted and when
they are granted, they pertain the 70% of the value and not the 100%
which was recently standing.
Inevitably,
the market is affected and we expect the support of the banking
system ,to support the resurgence and the reversal of the negative
climate.
Even
if
the
prices
move
on
higher
levels
than
the
reasonable
values
(20%-25%), they
do
not
considerably
abstain from
those, so we do not realize the bubble
phenomenon.
This, substantially constrains the possibility that the prices will
be drastically reduced and lead to a serious real estate crisis in
Greece.
However,
it will certainly cause their rationalization.
The
last months of 2008 and January of 2009 presented gradual reduction
of demand; of course especially January is traditionally a month of
diminished mobility.
So,
we presume that in case the international conditions do not
dramatically acidulate,
this year the consequences from the crises will be more observable,
with reduced demand, mostly rooted to the ground prices, with slight
reduction.
The
boost
of
the
market
by
the
banking
system
will
be
beneficial, but the overall improvement of the economy and the
psychology of the market are needed.
Finally, I would like to
inform you that it has been set to discussion from the
respective ministry, the law proposal concerning the
business rights and real estate agents' responsibilities.
The outlooks of
our colleagues are divided and the discussion continuous.
In general, it
defines three real estate categories: real estate agent, assistant
real estate agent, real estate administrator, counting in the
educational level and the longevity.
For instance ,it
defines as obligatory the intercession
reference in contracts .
It is judged as especially
positive, that a serious attempt from the government is finally made
to this direction.
Positive as well
is our approach to the other Real
Estate Association and our attempt to create an understanding
climate, so gradually a discussion can start.
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