“Generation of Renters” in Athens
Based on data compiled by the Bank of Greece, from 1998 and until 2019, residential prices in Greece grew by a total of 57%, even after an average fall of 44% during the era of the financial crisis, which lasted from early 2009 and up until the end of 2017. However, during the same 20-year period, the average basic salary has in fact been reduced, when inflation-adjusted. Today, the basic monthly salary is 758 euros, when in 1998, in inflation terms, the average salary stood at 772 euros. So, in essence, the purchasing power of the Greek households has been considerably reduced, effectively shutting out of the property market, many new households, even more so if they can’t receive some financial assistance by their parents or elders.
At the same time, after the recent debt crisis and the accumulation of non-payable loans (NPLs) of over 60 billion euros in housing alone, credit standards by the Greek banks have been made much more strict. Today, a potential buyer must be able to finance on his own, approximately 30-40% of the value of the property.
For all of the above reasons, but also because there’s a shift in the buyers’ way of thinking (especially among people aged between 20 and 35 years old), a new generation of renters is emerging. This renters’ generation will dominate the residential market over the next decade. So, those who invest in the market today, with a view to let, or even build new residential buildings, offering management services at an attractive cost, are bound to exploit an important gap in the market. Demand for housing available to rent will only trend upwards over the course of the next few years, which is expected to create significant investment opportunities in the Greek real estate market.