Falling prices, falling transactions, cessation of construction: the recession hit in Greece full force now one of the main drivers of the economy and it is not clear that banks and family solidarity play a long time their as shock absorbers.
Unlike the United States or Spain, the Greek real estate market is not the cause of the crisis, even if the prices of second homes in particular, in the islands facing the sea, rose in dramatically since the 2004 Olympic Games.
The latest indicators, published this week by the Bank of Greece, show that real estate undergoes full effects of the crisis.
In the third quarter of 2011, prices of goods decreased by 14% over the same period in 2008, where they had a record.
Over one year, the decline was 4.1% in Greece, limited to 5% in the rich neighborhoods of the capital, but over 20% in the suburbs of Athens and in cities such as Thessaloniki, northern.
If residential rents continued to rise slightly, commercial rents have dropped between 25 and 50%, as evidenced by the rows of empty shops in Athens, the barred window of the yellow band "for rent" in Greek enikiazetai.
Sign the credit crunch, transactions, the number of 40000 in the first quarter of 2007 fell to 9000 in Q3 2011.
The construction industry traditionally dynamic in a country where one built for his children, also bites the dust, especially as the raw material costs remain high.
Building permits were down 32% over the first 7 months of the year. And employment in the construction sector accounts for only 6.3% of total employment (260200), against 9% in 2007.
Until now, family solidarity and the attitude of banks, which gave time to the borrowers by rescheduling loans, have played a damper.
But that policy accommodation could be challenged at the end of the mission of the American firm BlackRock, responsible for monitoring whether the Greek banks have sufficient funds in their bad debts.
The rate for real estate, reached 12.8%.
BlackRock, which should give its verdict in January, may be asked to draw a line under some of their bad debts, may lead to increased seizures, hitherto limited, some analysts fear.
In addition, the worsening crisis could prompt some owners to sell their property to offset the decline in their income and avoid paying the new tax imposed on real estate this autumn. Which would be unprecedented in a country that has one of the highest homeownership rate in Europe (nearly 80% against 57% in France) and where real estate is the key element of heritage and the transmission.
"What this country needs most is to preserve the value of its land and property assets: its only wealth," said Alexandros Manos, an official of the Bank of Piraeus, critical of new taxes.
Only foreigners could benefit from slumpPrices of villas on the islands like Mykonos connected are much lower, said Christos Vergos, real estate agent of the company Remax New Deal in Athens.
The state in turn is committed to its creditors to give up to twenty billion of real estate, but according to a European diplomatic source, many obstacles remain, starting with the fact that Greece has not cadastral worthy of the name and legal disputes hanging over virtually any terrain.
By Eve Szeftel |
