The property market in Greece’s capital has boomed over the last year with house prices rising by nearly 10% in the third quarter.
The latest data by the Bank of Greece revealed that the average price of an apartment in Greece rose by 7.9% between July and September, while those in Athens soared by 9.8%.
This was closely followed by the port city of Thessaloniki where prices grew by 8.7 % and 5.9% in other cities.
In addition, there has been rising demand for older properties over five years old compared to newer ones.
What is causing this rise in buying activity?
The Greek economy has seen a strong recovery in 2021, with the government forecasting an annual growth of around 7%.
This year’s economic growth has largely been driven by monetary support from the EU. Greece received €33 billion in funding under the NextGenerationEU programme to use towards making the country greener and more digitalised.
Some of the projects the government plan to implement with this money include:
- Financing the interconnection with the Cyclades Islands, increasing the potential for renewable energy sources
- Boosting the adoption of digital technologies, in particular by small and medium-sized enterprises, and supporting the purchases of digital services such as new technology cash registers
- Strengthening the labour market by increasing full-time employment
- Digitalising and improving public administration and the justice system
Demand for housing has also been helped by increased lending from Greek banks and the introduction of several tax incentives. These include the ENFIA property tax cut and the suspension of VAT payments on new buildings.
As well as this, the coronavirus pandemic has meant people have more savings which have now been put into property purchasing and deposits.