Greek property prices continued to fall in the first quarter of 2014, even though the economic recession eased, as squeezed household incomes, record-high unemployment and tax increases still took a toll.
Property accounts for a large proportion of household wealth as Greece has one of the highest homeownership rates in Western Europe – 80 per cent versus a European Union average of 70 per cent – according to European Mortgage Federation data.
Bank of Greece figures showed that apartment prices fell 7.5 per cent in the first three months of 2014 from a year earlier, after an 8.6 per cent decline in the previous quarter.
Higher property taxes to help reduce budget deficits, coupled with tight credit from capital-strapped banks and a jobless rate near 27 per cent have pressured the market.
Based on Greece’s central bank data, apartment prices have plunged 34.7 per cent from a peak in 2008, when the country’s recession began.
The property market could start to see some relief if the economy pulls out of a six-year recession this year.
Source: Reuters