The housing market is rapidly returning to pre-crisis values. Based on the latest data from the Bank of Greece, prices in the region of Attica have recorded a rally of 44.6% from the second quarter of 2018 to the same quarter this year. They are now just 18% off their 2008 high.
Nationwide, the increase in prices over the same period came to 31.2%. In Thessaloniki, prices have increased 32.2% in the last four years, while in the other big cities this figure stands at 18.6%. Correspondingly, from the second quarter of 2018 until the second quarter of this year, the prices of newly built houses recorded an increase of 34.3% across the whole country, while those of older houses have increased by 29.3%.
On an annual basis, residential property sale prices rose in Q2 this year by 9.4% nationally, which is marginally higher than the 9.3% in Q1, following the revision carried out by the central bank (from 9.1% based on provisional data). At the same time, the central bank finalized the amount of the increase in house prices in 2021 at 7.5%, from 7.1%, which was the initial estimate.
Between April and June, newly built apartments saw an increase of 10.5%, while the corresponding increase in the prices of older properties was 8.7%. Based on revised BoG figures, in Q1, new builds rose by 10.4% and used properties by 8.5%. The largest increase in Q2 was to be found in the region of Attica with 10.9%, while in the first quarter, the increase had reached 10.5%.
The war in Ukraine does not appear to have halted the upward march of prices, which remain the highest since the start of the financial crisis. However, whether this image is sustainable in the coming quarters remains to be seen, as the market has countervailing trends. On the one hand, a negative climate appears to be developing among interested buyers as a result of the energy crisis and the insecurity it creates. On the other, however, it is becoming clear that the cycle of low-cost borrowing has been completed.
