Chinese investors are expected to storm the Greek residential real estate market, global real estate giant Juwai IQI, headquartered in Malaysia, said in a report published on Tuesday.
The company says that Portugal’s decision to effectively end its Golden Visa will turn Chinese investors to Greece.
“We believe gold visa applications could climb by more than 50% in Greece with the close of the Portuguese program,” Juwai IQI Co-Founder and Group CEO Kashif Ansari said.
“The Greek program is attractive in its own right, has vanishingly few competitors, and is popular with Chinese applicants. With the Chinese just beginning to resume international travel, you can expect their rate of participation to climb. China already accounts for 62% of all current active Greek golden visas,” he added.
The number of high-quality golden visa programs offering Schengen Area residency in Europe is fast diminishing. Both the UK and Ireland closed their visa programs in the last 18 months.
Portugal will soon close theirs, and politicians in Spain have made noises about limiting or closing the program. That would leave just Greece, Malta, and Latvia as the only programs still standing.
Greece has recently announced that it will raise the minimum investment for a Golden Visa to €500,000. In recent years, a surge of people from outside of the European Union have sought a Golden Visa in Greece. However, there have been concerns that the large number of foreign investors buying property in the country has made it more difficult for Greeks to find homes at affordable prices.
Juwai IQI estimates that the raise in the minimum investment will have minimal impact on the demand from Chinese investors.
Chinese buyers make large investments in Greek real estate
“Chinese buyers tend to make relatively large investments of €650,000 on average, which means many Chinese applicants won’t be affected at all by the new minimum investment,” Ansari said.
“The higher minimum investment in Athens, Thessaloniki, Vari, Mykonos and Santorini has a good side. It should limit popular opposition to the program by reducing the impact it might be perceived to have on housing affordability in tight markets,” he added.
Chinese buyers are often looking for family homes to occupy full-time or to occupy part-time and lease part-time. They want a location that is convenient for services and transportation and also need to be close to good international schools.
Juwai IQI says that there is significant pent-up demand for Greek property in China, but the opening of the borders alone isn’t enough for that demand to translate into transactions.
There is a need to restore the flights between the two countries near to the level seen in 2019 so that Chinese buyers can travel to Greece, the company notes.
It adds that a slow-moving residential real estate crisis in China is undermining demand for domestic property and pushing Chinese investors overseas.
Since the property market looks like it may remain stalled for years, the situation is giving impetus to a new Chinese overseas investment boom – although one likely to be more restrained than what took place from 2014 to 2018.