Athens properties less attractive after the big price increase
It now takes more than 21 years for an investor to get his capital back in Athens, as property prices have risen far more than rents.
The attractiveness of real estate in Athena level amid a continued price rally in the housing market and increases the payback time for an investor.
According to recent data, rents in Athena are lagging behind price increases, with household incomes being squeezed significantly by higher interest rates and inflation.
This is an indication that the galloping housing market in Athena not “endure” the new levels, pushing investors in other regions of Greece in their search for a more balanced price-rent relationship and new opportunities.
“With today’s prices it is much more difficult to find a good investment in Athens. The margin for profit has been greatly reduced”highlights real estate investor operating in Hellas and Cyprus in the Business Daily.
“Thessaloniki is a good example of a Greek city that now offers itself for new investments with better prospects in everything that has nothing to do with capital gains and incomes”he adds himself.
In the data collected by the company Profit level for 17 attractive metropolises in Central and South Europe including seaside resorts, in the Apartment Return On Investment Comparator, the image of of Athens worsened in the last twelve months.
For 2023the Athena it is relatively high in the ranking, in fourth place, but it is two places ahead of 2022.
Specifically, an investor the 2023 he needs 21.3 years so as to complete the depreciation of a residence in Athena (at present rents) while the 2022 was just needed 17.6 years.
In first place is Valencia and then follow the Canary Islands and the Barcelona. Interestingly, the price-to-rent ratio improved in all three parts of Spain, but in Athens it worsened by 20%.
Also, it is emphasized that in 2022 the price increases in Athena exceeded those recorded in Spain for the same period, although in Hellas a third of the population declares that they cannot make ends meet with housing costs. It is noted that the corresponding percentage in the Iberian Peninsula amounts to 11%.
According to her data Bank of Greece for its first nine months 2022 it is observed that apartment prices increased by an average of 10%, while in Spain the increases barely exceed 2%.
“Although apartment prices in Europe have risen, albeit slightly, in the vast majority of cases, market rents have risen faster over the past year”supports the Lucia Žarskáanalyst at Profit Level.
“The rapid increase in apartment prices continued among the destinations we monitored, mainly in Crete and also in Marseille, France”she adds herself.
Another striking element from the market analysis by Profit Level is the decrease in yield of rental apartments in HERACLION, Crete.
According to the company, an investor wants it 2023, 37 years in order to make the depreciation of an apartment in the largest city of Crete, vs 23 years it 2022. Based on the specific index, its performance Heraklion worsened by 58%.
Figures are based on crowd sourced data Numbeo.comwhich has over 100 data points for the latter 12 months, even for small towns. The data were collected on January 6, 2023. The rents captured are in the category of one-bedroom apartments in the city center.
Repayment period (in years), January 2023 | Repayment period (in years), January 2022 | Change 23/22 | |
Valencia | 16.69 | 17.06 | -2.17% |
Canary Islands (Las Palmas) | 19.44 | 23 | -15.46% |
Barcelona | 19.48 | 22.51 | -13.45% |
Athena | 21.39 | 17.66 | 21.15% |
Warsaw | 23,25 | 30.76 | -24.42% |
Krakow | 24.33 | 25.19 | -3.41% |
Ljubljana | 27.13 | 25.62 | 5.90% |
Budapest | 28.43 | 29.67 | -4.18% |
Milan | 28.72 | 27.42 | 4.75% |
Bratislava | 30,31 | 26.11 | 16.07% |
Marseille | 31.51 | 21.78 | 44.68% |
Nice | 31.64 | 29.71 | 6.49% |
Dubrovnik | 32.9 | 42.38 | -22.37% |
Prague | 34.07 | 35,46 | -3.92% |
Munich | 37.08 | 38 | -2.41% |
Crete Heraklion) | 37.1 | 23.37 | 58.75% |
Vienna | 38.84 | 37,16 | 4.53% |