Apartment Prices in Greece Skyrocket

Apartment prices in Greece have skyrocketed, estimated that in the second quarter of 2021 nominal prices increased by an average 4.6 percent.

The figure is compared to the corresponding quarter of 2020, while in the first quarter the increase was 3.5 percent, according to Bank of Greece data.

For 2020, the nominal apartment prices — the type of housing the vast majority of Greeks buy — increased at an average annual rate of 4.4 percent.

More specifically, the increase in prices in the second quarter of 2021 compared to the corresponding quarter of 2020 was 4.7 percent for new apartments, ie up to five years old, and 4.6 percent for older ones.

Revised data

Based on the revised Bank of Greece data, in the first quarter of 2021 there was a 3.4 percent increase in new apartment prices in Greece, while the prices of older apartments increased by 3.6 percent  compared to the corresponding quarter of 2020.

In 2020, prices for new and old apartments increased at an average annual rate of 4.8 percent and 4.1 percent respectively.

The analysis of data by geographical area shows that the increase in apartment prices in the second quarter of 2021 compared to the corresponding quarter of 2020 was 6.4 percent in Athens.

In Thessaloniki it was 4.1 percent, 3.2 percent in other major cities and 2.6 percent in other parts of the country.

Based on the revised data, in the first quarter of 2021 apartment prices increased by 5.6 percent in Athens, 3.8 percent in Thessaloniki, 1.6 percent in other major cities and 0.9 percent in other parts of Greece, compared to the first quarter of 2020.

For the whole of 2020, the increase in prices in the same areas compared to 2019 was 7.6 percent, 4.8 percent, 0.2 percent and 1.8 percent respectively.

Apartment prices in urban areas in Greece

For all urban areas of the country, in the second quarter of 2021 apartment prices increased by 4.7 percent compared to the second quarter of 2020.

Based on the revised data, in the first quarter of 2021 the corresponding increase in apartment prices in urban areas in Greece was 3.6 percent, while for the whole of 2020 the average annual increase was 4.7 percent.

Greek real estate market highly dependent on foreign investment

The housing market in Greece moved in the opposite direction from the rest of the economy in 2020, despite the adverse impact of the pandemic, according to a report by DBRS credit rating agency.

The rate of price increase was 4.6 percent, reduced compared to the 2018-19 due to the restrictions imposed against the spread of Covid-19, but continued an upwards move this year.

According to DBRS analysts, the Greek real estate market is highly dependent on foreign investment, which results in larger increases in Athens and other popular tourist destinations.

Apartment prices in other areas of Greece, with limited investment interest, although they probably benefited from the transmission effect, are still low.

The main conclusions of the DBRS report are:

1. The housing market shows resilience in 2021 despite the economic impact of the coronavirus crisis.

2. The highest price increases are observed mainly in Athens and in areas of interest for tourism investments, which has an impact on other areas.

3. The development of the housing market as a whole will depend on the long-term development prospects in Greece.