Greece’s Housing Cost among the Highest in the EU

ATHENS – The Greeks are EU “champions” in terms of housing costs, according to data from the Bank of Greece.

More specifically, basedon the Financial Stability Report, the percentage of income that Greeks spend on housing is the highest in the EU and reached 34.2% in 2022 (followed by the Netherlands, Denmark and Germany), when the rest of the Europeans spend an average of 19.9%.

Also, 27% of the country’s population shouldered housing costs that accounted for more than 40% of their disposable income, when the corresponding percentage of the population in the euro area was 9.4%.

Regarding real estate prices, the Bank of Greece estimated that there is room for further growth despite their significant increase over the last years. This is attributed to the fact that housing prices in Greece are still far from the historic high recorded before the financial crisis of 2008. The highest value of the index was observed in the year 2008 (101.7) and then followed a steady downward path, with the lowest price recorded in 2017 (59).

The situation with rents is similar, with the relative index being 98.5 based on the data of the third quarter of 2023, compared with 94.8 in the fourth quarter of 2022. The rent index remains significantly lower than the highest point (124.3 in the third quarter of 2011).

In the second quarter of 2023, the prices of new apartments (up to 5 years old) increased at an average annual rate of 13.8%, while the prices of old apartments rose by 14.1%. Higher increases were recorded in the urban centres. More specifically, prices in Thessaloniki rose 16.4% and in other large cities 14.6%.

However, despite the continued increase in prices, demand for housing loans remains moderate.