Property values were adjusted three years ago and since then commercial prices have seen a significant increase. A new increase, now, of the objective prices to the commercial levels, would have the effect of triggering a new upward rally in the market prices of real estate, exacerbating the acute housing problem.
Thus, to the extent that the proposals are approved, it will be another measure, alongside the housing "package" announced by the Prime Minister from the TIF platform and presented in detail by the relevant ministers this week.
At the same time, in the intentions of the financial staff is the new suspension (expires at the end of the year) of the VAT on newly built properties, like the property capital appreciation tax. In both cases, the suspension will cover at least 2025. It is noted that the postponement of VAT - a decision taken by the government in 2019 - contributed significantly to the increase in sales and the construction of new properties during this period. The postponement of the implementation of the capital gains tax had a similar positive effect.
The real estate market
High demand for housing is fueling the upward trend in property prices, market sentiment data shows.
According to the data of the Bank of Greece, in the second quarter of 2024, apartment prices increased by 9.2% compared to the corresponding quarter of 2023, while in the corresponding comparison last year the increase was 13.8%. In the new apartments (up to 5 years old) the increase during the second quarter of this year amounted to 10.7% and to 8.3% for the oldest ones (over 5 years old).
The analysis of the BoG data by geographical region shows that the increase in apartment prices in the second quarter of 2024 compared to the corresponding quarter of 2023 was 9.1% in Athens, 12.1% in Thessaloniki, 7.3% in the other big cities and 10.4% in the other regions of the country. For the whole of 2023, the price increase in the same regions compared to 2022 was 13.8%, 16.5%, 14.9% and 11.6% respectively. For all urban areas of the country, in the second quarter of 2024, apartment prices were on average increased by 9.0% compared to the second quarter of 2023, while for 2023 the average annual increase was 14 .2%.
Nationally, property prices are still below (albeit marginally) the previous record set in 2008. Since 2017, when the market recovery began, prices across the country have increased by 69% on average. In Attica the increase amounts to 88% and in Thessaloniki to 78%.
