The pattern that stands out in the Greek residential property market this year is the sale of homes costing up to 150,000 euros each, with bank funding of no more than 70-80 percent, according to data compiled by Individual Market Solution (IMS).
However, unlike in previous years, buying interest has clearly increased, even if for the time being the available budget of interested buyers is definitely lower than in the years before the financial crisis, when a large part of demand had concerned newly built homes in the 250,000-300,000-euro range.
IMS, which has a significant share in the mortgage market, has found that, on average, 40-50 mortgage loans have been issued per month this year. According to Giorgos Gkiokas, sales director and co-founder of IMS, “in 2018, we secured approvals for about 30-35 housing loans per month, while in 2017 the figure came to even less than half of this year’s, so it is clear that property buyers have increased.”
The average value of mortgages disbursed for the housing market this year comes to almost 100,000 euros, showing an increase of more than 20 percent from last year, when the average loan didn’t exceed 80,000 euros. As for funded properties, their average value has risen from 118,000 euros in 2018 to 140,000 euros in 2019.
Gkiokas says that “the property market is deeply embedded in the Greek culture, even today. What has changed compared to previous years is the fact that today’s borrowers are more conscious and require a higher level of services and proper information.” Nevertheless, the prices that most Greek house-hunters today can afford are a good deal lower than those regularly paid in the pre-crisis years, which rules out most newly built assets, whose prices generally come to more than 200,000 euros regardless of the area.
For a 30-year-old single person to get a floating-rate mortgage of 100,000 euros to be paid over 30 years, they would need to have a net annual income of 15,000 euros. If they have one or more children, this amount would rise. Typically, a mortgage concerns at least two people – i.e. either a couple or a child with the parent as guarantor. Such a loan would require some 450 euros per monthly tranche, though this would be significantly lower than the rent the same person would have to pay for a property of similar quality given the recent hike in rental rates.
Source : Kathimerini