Housing is out of reach for many in Greece as it takes 11 years for a worker with an average salary to acquire a 20- or 30-year-old apartment of 60 square meters in Athens a report highlighted.
Just three years ago, 8.5 years of salaries were required for the same property, which is in line with the European average.
An analysis by Cerved Property Services, analyzing data from Ergani and UBS, shows that Athens is among the most expensive cities to buy a property as regards the purchasing power of households.
The Greek capital ranks fifth among the cities analyzed worldwide, highlighting the soaring of residential rates while household labor incomes did not increase at the same rate.
Compared to Athens it is (relatively) more expensive to acquire a property only in Tel Aviv, Paris, Tokyo and Hong Kong. At the same time, Athens is now on par with London, while surpassing cities such as Munich, Zurich, Geneva, Amsterdam, Vancouver, Frankfurt, Dubai, Los Angeles, Stockholm and Miami.
According to the report, in 2018 the average selling price of a residence in Greece was 175,000 euros, while the average monthly salary was €1,071. By 2023 the average selling price of a home had shot up by 57 percent to €274,831, while, on the contrary, the average salary in the same period had increased by only 19.5 percent.
While some of Greeks’ income is understated, as more than 50 percent declare an income of less than €10,000, salary earners in particular have seen their purchasing power decline dramatically, even after the recent salary raises.
This is also certified based on other indicators. For example, based on price per sq.m., the housing market in Greece is among the cheapest in Europe, costing €2,200/sq.m., being more expensive only than Latvia, Romania and Bulgaria.
The most expensive market is that of Switzerland, where the average price/sq.m. reaches €15,000, but because salaries are also much higher, in the end the purchase of property by citizens is more accessible compared to Greece, and especially the market in Athens, the Cerved Property Services report notes.
Housing costs skyrocket in Greece
The Financial Stability Report by the Bank of Greece (BoG) issued last November maintains that Greece leads Europe in housing costs.
According to the report, 27 percent of the Greek population is spending more than 40 percent of their disposable income to cover housing costs. BoG attributed the country’s position to its low per capita income compared to the rest of Europe.
BoG says that:
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- Apartment prices (in nominal terms) rose by 13.9 percent in the second quarter of 2023, year-on-year, compared to an increase of 11.8 percent in 2022.
- Prices of new apartments (up to 5 years old) increased at an average annual rate of 13.8 percent, in the second quarter of 2023, while prices of old apartments rose by 14.1 percent.
- In terms of geographic region, prices in the country’s major urban centers rose significantly. This was especially the case in Thessaloniki (16.4 percent) and other major cities (14.6 percent), which exceeded the corresponding average growth rate for the entire country.
Housing costs and home prices in Greece
A recent report by Bloomberg reveals home prices in Athens are surging, making the Greek capital one of Europe’s hottest housing markets.
Home prices in the Greek capital rose by 12.2 percent in October, nearly triple the gains in Stockholm. In other cities, such as Paris, there was a drop in prices, according to data compiled by Bloomberg.