Greeks face soaring property prices

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These thirty-somethings have been looking for a year to rent an apartment on the outskirts of the Greek capital where, as in other large European cities, property prices are skyrocketing.

In Greece, the surge in rents due to the growth of tourism and the arrival of foreign real estate investors is one of the challenges of the European elections along with low incomes.

“For 80 m² in Koropi (a popular suburb of Athens), rents are over 500 euros, a considerable increase for our tight budget“, indignant Kyriaki Tsouti, unemployed.

His partner’s salary is only 750 euros net per month and 60% of it is spent on housing and apartment expenses.

The couple, who plan to have a child, wish to move from their current home due to “serious humidity problems“, explains Dionyssis Giakoumelos, 32 years old.

“We have visited dozens of apartments (…) but without results so far“, deplores this company employee, also a researcher in the real estate sector.

Bottom of the ladder

Greeks spent an average of 34.2% of their income on housing in 2022 compared to an EU average of 19.9%, the highest percentage for housing costs in the 27 club, according to a report of the Bank of Greece published in November.

And despite the recent increase in the minimum wage, to 830 euros gross per month, Greece also remains at the bottom of the scale of the 27 member countries, at 21^e place, according to Eurostat.

“With a thousand euros per month and a rent of 550 euros excluding charges, what is left to live on?asks Nikoletta Diga, a 36-year-old civil servant, who recently took part in a demonstration of hundreds of people in Athens demanding “the right to affordable rent“.

“Willy-nilly, I was forced to find a roommate to get by“, she continues.

Wages fell by 32% between 2009 and 2022 due to drastic cuts during the financial crisis (2009-2018), according to the Organization for Co-operation and Development (OECD), and remain the lowest among developed economies.

Currently the purchasing power of Greeks is 67% of the European average (26th place ahead of Bulgaria), according to Eurostat.

Government policy to promote tourism after the COVID-19 pandemic has played a role “a catalytic role“, assures Thomas Maloutas, professor of social geography at the University of Harokopio.

“Overvalued”

The increase in the number of tourists has pushed prices up in favor of short-term rentals, as in other popular European cities.

“The market is overvalued. Overtourism and +golden visa+ have attracted foreign investors and stimulated demand while Greek incomes stagnate“, underlines Thomas Maloutas.

In certain neighborhoods of Athens, entire buildings have been purchased by Chinese, Turkish, Russian or Middle Eastern investors thanks to the “golden visa”.

Introduced during the crisis to give a boost to the economy, this measure allows foreign nationals investing in real estate to obtain a residence permit.

“Owners prefer to rent or sell their apartment in Athens at a high price and settle in the outskirts“, observes Dionysis Giakoumelos who campaigns for the abolition of the “golden visa” as in Portugal.

Faced with growing discontent, the government has tightened the rules for the “golden visa”, the investment required to obtain it has increased from 250,000 to 800,000 euros. It also imposed limits on short-term rentals.

But the forced gentrification of neighborhoods near the center of Athens where a new metro line is under construction has led to the eviction of small owners or migrant tenants of old apartments, according to real estate experts.

“The crisis affects students, young professionals, elderly people and refugees“, estimates Thomas Maloutas.

Georgia Stratigakou, 73 years old, owner of an 80 m² apartment in Athens, acquired thanks to a property loan in the 1980s says “now be afraid of losing him.”

“With our meager pensions, it’s difficult to pay taxes and billss” which continue to increase, she deplores.

AFP/VNA/CVN