November 12, 2018 / 12:24 PM / a month ago

Greek property prices rise for a third consecutive quarter

    * Residential property values rise 2.5 pct y/y in Q3
    * Economic recovery, strong foreign interest reflected in
prices
    * Prices had declined by 42 percent since 2008 peak

    ATHENS, Nov 12 (Reuters) - A recovery in Greece's
residential property market gained momentum in the third quarter
of 2018, central bank data showed on Monday, suggesting an
improving economy and growing foreign interest may help property
prices rise further. 
    Property accounts for a large chunk of household wealth in
Greece, which has one of the highest home ownership rates in
Europe at 80 percent, versus a European Union average of 70
percent, according to the European Mortgage Federation.
    Prices of the apartments in which most Greeks live rose 2.5
percent in the quarter from a year earlier, Bank of Greece data
showed, with the recovery accelerating from an upwardly revised
1.2 percent increase in the second quarter of the year.
    More specifically, prices have risen by 3.7 percent 
year-on-year in Athens, where home-sharing platforms like Airbnb
and a "golden visa" programme -- a renewable five-year
resident's permit in return for a 250,000-euro ($285,000)
investment in real estate -- have grown very popular.

    Prices had slid 1.0 percent in 2017 from a year earlier, 
taking the cumulative fall since 2008, when the country's
protracted recession began, to 42 percent.
    "The trend seen in the beginning of the year is strengthened
further and reflects belatedly an improvement in economic
conditions", said National Bank economist Nikos Magginas.
    "Airbnb has driven rents higher and creates positive
prospects for the real estate market and optimism for a
continued upward trend, mainly in Athens."
    The market has been hit by property taxes imposed to plug
budget deficits, tight bank lending and a jobless rate still
around 19 percent, the highest in the 19-nation euro zone.
    Greece's economic prospects have improved since it signed up
to a third bailout package worth up to 86 billion euros ($107
billion) three years ago.
    Its 180 billion-euro economy expanded for a sixth straight
quarter in the period through June this year, but at a slower
pace than the quarter before, on weak investment spending.

    Following is a table on Greek apartment prices from the
central bank of Greece:
    
               2013   2014   2015   2016  2017*   Q3 2018*
 Index         69.5   64.3   61.1   59.6  59.0    60.3
 Change y/y    -10.9  -7.5   -5.1   -2.4  -1.0    2.5
 %)                                               
 New (up to 5  71.4   66.8   63.0   61.2  60.7    62.1
 years)                                           
 Change (%)    -10.9  -6.5   -5.6   -3.0  -0.7    2.9
 Old (older    68.3   62.8   59.8   58.6  57.9    59.2
 than 5                                           
 years)                                           
 Change (%)    -10.8  -8.1   -4.7   -2.0  -1.2    2.2
 
    
* provisional data
source: Bank of Greece    

 (Reporting by Angeliki Koutantou, editing by Larry King)
  
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