For generations of Greek families, property has always been seen as the most secure and desirable long-term investment, a safe haven for wealth and a potential source of income.
However the second homes that were once a source of wealth and pride for many Greeks have now become a gross liability as the government, desperate for cash, has imposed stinging property taxes in recent years.
Particularly for Greeks who have recently lost all or most of their incomes yet have a number of properties to their name, this has left them facing tax bills that they simply can’t afford. The only option is to sell the real estate. Yet with many in the same boat, in a country in its sixth year of recession, housing prices have tanked.
As reported by the Guardian, “basement flats are selling for as little as €5,000 (£4,150) in the less salubrious parts of Athens.” That is, if one can find a buyer. The same article states that last year, even with prices severely depressed, there were only 3,600 sales across Athens. In 2005 there were 250,000.
As the article states:
“Greece's social and economic crash is reflected in its property slump. Data released by Eurostat, the EU's statistics agency, earlier this month showed that the country had suffered the second steepest decline in house prices after Croatia, the bloc's newest member.
Since the outbreak of the Greek debt crisis four years ago, property values nationwide have dropped by around 32%, according to the Bank of Greece; estate agents contacted by the Guardian estimated the decline at nearer 50%.”
Of course what is disaster for some, is a golden opportunity for others, as the Financial Times reports:
“..for steely-nerved investors, Greece offers a once-in-a-generation buying opportunity, with a record number of high-end properties on the market, says Katerina Samaropoulou of Samaropoulou Associates, a Greek estate agent.
“Prices have fallen by around half since 2008. You can find excellent quality vacation homes in Greece at similar prices to Spain and Turkey, where previously they could be as much as 40 per cent higher because so few were available.”
While the article also notes the consequence of the economic crisis and property taxes on average Greeks, it devotes a greater number of inches to high profile sales such as the purchase of Skorpios, the famed private island owned by Onassis, to the daughter of a Russian billionaire for €100m.
“There is now a wide choice of 200-300 sq metre Cycladic villas with infinity pools, hot tubs, intelligent home control systems and magnificent sunset views. Once valued at €10,000 a sq metre, they are now on offer at €4,000-5,000 or less as cash-strapped architects and their clients struggle to make ends meet.
The seriously wealthy are looking for privacy, not simply a high-end house, according to [Alexandros Moulas, head of residential property at Savills International in Greece].
“They want a private beach if possible, or at least direct access to the sea, and a jetty where several yachts can tie up,” he says.
It even includes a handy property buyer’s guide for wealthy foreign potential investors. As the article notes, while Brits and Germans have traditionally dominated the Greek property market now more Eastern Europeans, Scandinavians and Swiss are exploring the market.
All of which once more highlights an obvious but troubling fact of the Greek crisis. That much of the pain suffered by average Greeks due to troika-mandated programs of austerity translates directly into opportunities for the rich, both in Greece and abroad. Which inevitably leads one to question whether everyone shares the same sense of urgency when it comes to restoring prosperity to the country.