In one of the most profitable investments, with a return of up to 126% over the past five years (2017-2022), the housing market has developed in recent years. The “brave” people who bought an apartment in Attica in 2017, that is, when the real estate market began to recover, are the big winners today, as they saw that the value of their investment even more than doubled.

Of course, in 2017 the conditions in the economy and in the real estate market were very different. In essence, the mortgage market was not working, which means that those who placed then had accumulated liquidity from previous years and could finance with their own capital 100% of the purchase of real estate. At the same time, they were willing to take the appropriate risk by betting on the recovery of the economy and therefore the real estate market, although Greece remained under the regime of capital restrictions, but also within the framework of the memorandum.

However, those who finally decided to take such a step recorded a very significant capital gain today. For example, in 2017, the average purchase price of an apartment with an area of ​​85 sq.m. (two bedrooms that is) and aged 35-40 in Exarchia cost only 60,000 euros. The attractiveness of the area through short-term rentals has not yet begun, while it is this category of property, namely the old apartments in the center of Athens, that suffered the most during the financial crisis. Demand has stagnated and prices have in some cases fallen by 70-80%, higher than the average decline in sales prices between 2009 and 2017, when the housing market was in a doldrums. In Kipseli, the average price for a corresponding apartment was 68,000 euros, in Ampelokipi, 71,000 euros, and in Nea Smyrni, 75,000 euros.

The brave, those who took risks and invested in the prospect of Greek economic recovery are being rewarded today.

Today, prices in these areas have even more than doubled due to high demand from both foreign investors interested in obtaining a residence permit under the Golden Visa program, and those who have the opportunity to exploit real estate through digital short-term rental platforms. For example, in Exarchia, a house that cost €60,000 in 2017 is now on sale for €136,000, earning €76,000 or 126%. These figures are based on actual sales transactions carried out in the respective years, i.e. 2017 and 2022, through the RE/MAX Hellas real estate office network. The yield in Nea Smyrni and Galatsi is also 126%, while in Kypseli it is 68%.

However, very large capital gains have also been registered in the northern suburbs, where demand has now increased significantly, mainly due to Greek buyers. In Marousi, buying an old apartment in 2017 cost about 85,000 euros, while today the same property is valued at an average of 187,000 euros, which is 120% more. Accordingly, in Chalandri, a property that was sold for 93,500 euros in 2017 is now being sold for 204,000 euros, or 118% more. Yields of 106% are also recorded in the Kifissia region, where the average price is currently 272,000 euros, while in Vrilissia, the yield reaches 95%.

It is noted that the above prices for 2022 undoubtedly lag behind those found in the announcements. There you can easily find an asking price of more than 250,000 euros, often even 300,000 euros for properties with the same characteristics, i.e. from 85 to 100 sq.m. and over 30 years old, which are also the most sought after. However, the reason older properties are in demand is precisely because of their availability. As owners of such properties raise prices, they will see their homes stop selling and therefore remain unsold for months or even years.

The market expects less growth in the coming years

“Past results do not guarantee future results,” investment advisors often say to inform and warn their clients and interested investors. Something similar is happening in the real estate market, as the current situation does not seem so favorable for achieving similar returns in the future. In fact, most analysts and market professionals seem to agree that the price rally that took place in previous years and peaked in 2022 seems to be coming to an end. In fact, some feel that some areas are even overpriced (based on asking prices) and would require 10-15% adjustments to be able to sell more properties.

With the ECB raising interest rates again to 3.25%, switching to bank lending is becoming especially expensive, even if you opt for a fixed rate for the first few years of a mortgage. It may be that today 70%-80% of transactions are carried out exclusively with equity, however, as long as prices remain at the current level or grow even more, some kind of mortgage loan will be required to replenish the required amount.

At the same time, as can be seen from the course of the My Home program, although there is demand on the market, but compare it with suitable real estate in terms of price, characteristics and area. What is essentially happening is that there is a significant supply of poor quality and expensive apartments, which is disappointing to many interested parties who end up postponing the decision to buy, waiting for the “rationalization” of those owners who are asking for more than 2500 euros. /sq.m. for properties over 40 years old without renovation.

It should be noted that it has not yet become widely known that anyone who buys today an apartment that falls under the two lower categories of the Energy Efficiency Certificate (PEA) should keep in mind that in a few years it will be necessary to vigorously modernize it under the new EU directive recently adopted European Parliament.

Based on what was accepted, those owners who want to transfer or rent out their property should have taken care of its vigorous renewal in advance. In the case of residential buildings, this will start to apply from 2030. So, for example, an apartment in the center of Athens, which is currently in category “Z” of the energy certificate, will have to undergo energy retrofit works worth 15,000 – 20,000 euros in order to be insulated and able to be energy upgraded in accordance with the required two categories, for example. in rank 5. From 2033, the minimum “growth” is set in the next highest “D” category. So it’s clear that today’s buyer will need to shell out an extra amount in a few years if they want to see their investment in the future, and it’s possible that even a property tax, as they say, could eventually be introduced. already opened at EU level