THE DYNAMIC OF THE GREEK PROPERTY MARKET REMAINS HIGH
Regions and prospects by sector
From luxury properties on Greek islands and the Athenian Riviera to old apartments in areas of Attica, ever-increasing domestic and international investment interest is focused on the Greek real estate market, according to published research and analysis. As highlighted in a report by APE-MPE, all estimates agree that the real estate market, of all individual categories, has positive prospects in 2024 as well, in continuation of the past two years.
The prospects by individual branches of real estate
As recently pointed out by the managing director of Alpha Real Estate Services, Yannis Ganos, of the Alpha Bank group, on the occasion of the change of the company’s name from Alpha Real Estate, the real estate market in our country is moving positively. The upward trend of real estate indices over the past few quarters, as well as the key macroeconomic figures, signal that the real estate market remains in the upward part of the economic cycle. Bank of Greece indicators, the economic climate, confidence in the construction industry, and even the slowing but positive growth rates of construction activity prove that demand is stable, Mr. Ganos said. He emphasized the recovery of the investment grade, commenting that this development gives significant additional confidence that the prospects of the Greek economy, and by extension the Greek real estate market, are positive and at the same time paves the way for attracting long-term investors.
Foreign investment in the Greek real estate market in 2023, especially residential, continued to show a positive trend after the all-time high recorded in 2022, the Golden Visa program regained momentum, commercial real estate attracted 40% more foreign capital inflows on an annual basis ( approximately 1.65 billion euros), together with 400 million euros of Greek AEEAP capital, while the institution of AEEAP is strengthened with large investments in real estate and infrastructure projects, said the CEO of Alpha Real Estate Services, which completed more than 80 years of successful operation “Illuminating” market prospects by real estate sector, Mr. Ganos estimated that in the office market, demand remains strong, rents show a positive outlook and yields could be compressed further, given the insufficient supply of modern offices and if borrowing costs deescalate. In retail, the outlook for the sector is positive, due to the recovery of economic activity and the thriving tourism sector.
In industry and logistics, investment interest is expected to continue due to the limited supply of modern units and the upgraded role of Greece as a transshipment hub. In hospitality, tourism and investment demand will continue, while hotel stock and industry infrastructure expand and upgrade, In residential real estate, alongside gradually increasing domestic demand, the market is attracting foreign capital and continues to be valued at a discount to of competitive European markets. Therefore, prices and rents are expected to maintain an upward trend.
Greece: Luxury real estate attraction for international investors
Greece is in an advantageous position, given the conditions, in the global luxury real estate market, according to the fourth annual report Luxury Outlook by Sotheby’s International Realty which was released. The publication captures the developments expected to shape the industry globally, being a reference point for the 83 markets where the house operates and for more than 1,100 offices worldwide, providing important data on the behavior patterns of Ultra High Net Worth Individuals and luxury housing markets. The report examines the dynamics of the sector, trends and preferences of buyers and, among other things, refers to the positive outlook for the luxury real estate sector in Greece for 2024, highlighting the country as an attractive investment destination.
In particular, in 2024, the real estate landscape in Greece continues to show positive development, creating challenges and opportunities for investors and owners of luxury properties. According to the president and CEO of Greece Sotheby’s International Realty Savva Savvaidis, the Greek luxury real estate market is in a phase of transformation, attracting a wide and international range of buyers. It attracts international investors from regions such as Central Europe, Egypt and Australia, opening new prospects for the industry in the country. In contrast to other foreign markets where attention is directed to the uncertainty of the economies, Mr. Savvaidis focuses on the economic recovery of Greece. As stated in the report, the improved conditions of access to financial instruments are expected to play a decisive role in increasing demand and closing deals in the luxury real estate sector. Easier access to loans, compared to previous years, is estimated to be an incentive for more buyers to invest in Greece’s luxury properties.
As Mr. Savvaidis reports to APE-MBE, the Athenian Riviera maintains its role as the strong card of the country, with the areas of Kavouri, Glyfada, Varkiza, Vouliagmeni, Sounio and Vari recording extremely high interest, without however this meaning that the demand for the special properties we have in our portfolio in the center of Athens is not important either. Outside of Attica, the patterns remain stable with Corfu, Mykonos and Paros being at the forefront of demand.”
Emerging trends in the luxury real estate market and the role of sustainability
At the heart of developments are sustainable homes, advanced technologies and especially artificial intelligence. According to Mr. Savvaidis, the revival of traditional materials, such as marble and stone, will play a decisive role. A renaissance is unfolding with timeless materials such as marble and stone making a reappearance, while contemporary designs with smooth lines remain dominant. The move to smaller and more manageable homes is helping to grow the city housing market and allowing buyers to consider some of the less developed areas of Greece, including island areas. However, the attention to the smaller houses does not imply concessions in the benefits. Apartments and buildings that offer hotel-level services and amenities redefine the concept of luxury living.
The case of the Athenian Riviera
The case of the Athenian Riviera, as reported in the international press, has attracted the attention of international and domestic interest, as well as of the Community, mainly due to the largest urban renewal in Europe in the Hellinikon area, as well as other large multi-million euro investments along the 70 km coastline. According to research, despite the rise in prices in the region, there are still significant investment opportunities as sales prices on the Athenian Riviera are still significantly lower than real estate sales prices on the French Riviera and in areas of Spain, etc. Interest in the real estate sector in the Athenian Riviera area is so intense, with a typical example being that all the properties put up for sale by Lamda Development in Elliniko (in the first green highest seafront skyscraper in Europe, villas and maisonettes) are sold for many months. At the same time, the demand for the apartments of the new Little Athens district that is being created in Elliniko is constantly increasing.
Investments in old properties – Which areas stand out
According to the results of research by Protio, the first investment apartment platform in Greece, through which owners of old apartments can be informed about the price of their property and offer it for sale to a private investor, America Square with a yield of 7.2 % is at the top of the investment performance list in the Attica region, in the last quarter of the year. The research is based on a range of data and indicators analyzed using artificial intelligence tools, revealing valuable insights into real estate market trends. More specifically, the use of this technology allows a more accurate and deep understanding of market changes, as well as the opportunities created in the real estate sector.
The research focused on investment performance in different areas, focusing on estimating property values and potential rental income. In the previous semester, Aegaleo took the lead with an 8.2% return, standing out as one of the most attractive areas for investment. Nikaia also falls from the podium in the second half of 2023 with 7.9% and the area of Patisia with 7.8% and the positions are occupied by the area of Attiki with 7.1% and Victoria Square with 6.9% which although with a lower performance than the previous one six months (7.7% and 7.1% respectively) now belong to the first three regions with the highest performance. The map of income property investments is expanding with some more important areas. They are followed by the area of the Polytechnic with 6.7%, Peristeri and Kypseli with 6.3%, Egaleo with 6%, Perissos (Neas Ionias) and Agia Sofia (Piraeus) with 5.9% and Korydallos with 5.8%.
The new additions offer investors a wealth of opportunities in various areas of the city, reinforcing the image of a dynamic and diversified market. The growing demand for real estate across the map of Attica, rising rents and asking prices, as well as the improvement of urban infrastructure have contributed to the upward trend in yields and the change in the map of the top 10 regions. According to the managing director of Protio, Antonis Fiorakis, ‘the course of the real estate market in Attica is extremely dynamic, while the map of the areas of interest is steadily and gradually expanding. The high demand for housing creates investment opportunities that are efficient and safe, especially compared to residential real estate returns worldwide.”It should also be mentioned that Protio among others helps owners of old apartments sell their apartments, private investors to invest in apartments while it now enables every owner of a closed and old apartment to renovate and rent it, therefore they too become potential investors, with the new Renovate & Rent service.