Growing interest in Greek real estate from foreign buyers is focusing on popular destinations such as Mykonos and Corfu as investors go bargain hunting but housing prices are holding firm despite weak conditions brought on by the pandemic, market sources say.
With many obstacles in air travel still in place, buying interest in Greece is mostly from the UK and other European countries, targetting holiday homes between 500,000 euros and 1.5 million euros, says Christos Mourdoukoutas, sales analyst at Algean Property.
"Their interest is mainly driven by investment purposes based on the dynamic of the Greek tourist product. As Greece coped successfully with the first wave of the coronavirus pandemic and managed to open its borders relatively early, it is expected that this year’s tourist season will not be completely lost, while it is also believed that next year Greece will be again a popular destination in the Mediterranean," Mourdoukoutas told Business Daily.
Popular locations with easy and direct access to airports are on investor radars, such as Crete, Paros, the Peloponnese, and the Athenian Riviera.
Strong interest, few deals
Despite the strong interest from foreign buyers, few deals are being completed. General uncertainty arising from the coronavirus and problems in international travel are weighing on the real estate market globally. This is more so the case for Chinese investors who have shown a particular preference for the Greek market in recent years.
"In some cases, (buyers) also treat Greece as a safe haven for them too, while others may be also looking to take advantage of a potential drop in prices caused by the pandemic. However, we have not observed such a drop in prices, at least not yet," adds Mourdoukoutas.
According to British real estate site Rightmove, Greece is in the top 5 of countries the British prefer to buy a seaside villa or a countryside house in. The top 5 countries are Spain, France, Portugal, Italy, and Greece.
A key reason why investors see Greece as a safe destination is the high returns offered by the assets. Algean data show that the average gross rental yield in Mykonos exceeds 8 percent, while in Ibiza (Spain) it is 3.8 percent and in Turkey, it is between 3.2-3.8 percent.
In Greece, initial figures show that housing prices are holding ground due to the wait-and-see attitude adopted by both sellers and buyers.
According to the Spitogatos Property Index (SPI), which monitors prices on published ads, the average selling price in the second quarter remained unchanged at 1,544 euros / sq.m. nationwide, compared with the first quarter of the year (1,545 euros / sq.m.).
On an annual basis, however, it seems that price growth is slowing down. In the second quarter, prices advanced by 4.8 percent on an annual basis, while the corresponding annual change in the first quarter of this year reached 6 percent.