Clear shift to house rentals
Owners are finding their asking prices are too high for current disposable income levels
A new balance has begun to emerge in the housing market, as economic recovery and interest from abroad push up values and rents. However, at the same time there are counterforces, as the purchasing power of households continues to remain stagnant due to a wave of commodity and energy hikes, as well as rising inflation. These developments appear to have fully offset both the recent increase in the minimum wage and the government’s tax cuts. Thus, both buying and renting a house now require a larger portion of the interested party’s budget than in the recent past.
In this context, the significant increase in asking prices for renting and selling residences seems to be more like wishful thinking on the owners’ part and does not seem easy to justify.
“There are indeed areas such as the southern suburbs and the center of Athens where demand for both buying and renting is high, justifying a price rise, but this is not the case for all properties and for all of Attica. In rents we are likely to see some price adjustment, more so in areas where the costs are unsustainable for most households, such as in some parts of the center, which are still asking for over 8-9 euros per square meter,” Lefteris Potamianos, president of the Association of Athens-Attica Estate Agents, tells Kathimerini.
For example, based on the data of the Spitogatos Price Index (SPI), in the year’s second quarter the average rental price in the center of Athens – although it remained stable at €9/sq.m. – is considered particularly high, even based on historical market data. Prices approaching €9-10/sq.m. mostly concerned apartments in the districts of Lycabettus and Kolonaki, but not in Ambelokipi and Pangrati, where the rate was usually around €6-7/sq.m.
This is due to the diversification of property features, as several are now furnished as well as renovated, as their owners had tried, unsuccessfully, to utilize them through short-term rental platforms. Another reason is the significant rise in demand for renting, as a large portion of new households cannot afford to buy a home.
