Greek real estate promises high returns
Favorable prices for Greek real estate promise investors high returns. Not only holiday homes, but also apartments in cities are in demand, according to the Handelsblatt (edition of March 16, 2020).
More and more foreign capital is flowing into the Greek real estate market. This is the start of an economic sector that was hit particularly hard by the country's financial crisis.
Greek real estate market begins to recover
Growing demand is causing prices to rise. We are only at the start of the recovery of the Greek real estate market. The trend will continue and intensify. The upswing is being driven by the recovery of the domestic economy, but also by growing demand from abroad. According to the Greek central bank, foreign property buyers brought 1.45 billion euros into the country last year. This means that 35 percent of all foreign direct investments flowed into the real estate market.
Greece real estate growth engine: Tourism
Tourism is a strong growth engine. The travel boom is causing growing demand for vacation rentals in Greece. The number of guests has been increasing continuously for seven years. They have almost doubled since the crisis year 2012. The industry expected a new travel record in 2020 but it is doubtful whether this hope will come true. The Hellenic hoteliers are already registering cancellations because of the coronavirus insecurity. In the longer term, however, the upward trend in Greek tourism is intact.
The price level, which is still low compared to other Mediterranean destinations, makes Greek real estate properties as an investment particularly interesting. The upswing in Greek tourism does not only increase the prices for holiday apartments in the popular target areas. The demand for residential real estate in Greek cities is also growing. City apartments that can be rented all year round are an interesting alternative to the classic holiday property market.
Short Term Rentals Greece
In parallel to the boom in short-term rentals, a network of service providers has emerged in Greece. They specialize in the brokerage of appropriate properties and take on the management of their apartments for a commission from property owners, from furnishing and marketing to the settlement of additional costs.
This is particularly interesting for foreign landlords who cannot take care of their properties on site.
Government: real estate comeback
Not only the high return expectations attract many investors. The fact that more and more foreign capital is now flowing into the Greek real estate market is also a result of the "Golden Visa" program with which the Greek government is wooing buyers from third countries.
The gradual recovery of the banking sector is also contributing to this. Greece's successful return to the capital market and the significantly lower bond yields also improve the liquidity of the banks. They are now actively recruiting customers for real estate loans.
In addition to the improved financing options, the market also benefits from tax breaks. So far, 24 percent VAT has been due on new-build properties. The conservative government has now suspended the tax for three years. The main aim is to reduce the large number of unsold new buildings from the crisis years.
The annual real estate tax Enfia is also easier: rates were reduced by 20 percent last year, and the burden is to be reduced by another eight percent this year.
Invest in Greece
The still low price level of Greek real estate promises investors who access it now that they will add value over the next few years.
A study by Piraeus Bank predicts that property prices in Greece will continue to rise until 2027.
Ferimmo is the meeting point for buyers and sellers of real estate in Greece and offers you a large selection of exclusive real estate offers and lots of useful information about buying real estate in Greece.
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