House protection criteria will benefit wealthy borrowers, too

The regulation that the Finance Ministry is promoting to freeze home repossessions effectively even protects households with high incomes, as it covers not only the 90 percent of households whose main residence is valued up to 200,000 euros, but also the minority that certainly require no protection.

That is evident from the data of the Hellenic Statistical Authority (ELSTAT), the General Secretariat for Information Systems and the European Central Bank which point to the fact that the vast majority of households are far below the threshold proposed for the auctions ban.

The limits the government is introducing concern households whose main residence is valued at up to 300,000 euros, whose total property is valued at a maximum of 500,000 euros, whose bank deposits do not exceed 30,000 euros and whose annual income is not above 50,000 euros.

In fact, ECB data show that nine out of 10 households in Greece have a main residence that is valued at up to 200,000 euros, far below the 300,000-euro criterion. Furthermore, the main residence of seven out of 10 households is valued at a maximum of 140,000 euros, according to ELSTAT, which leaves as much as 360,000 euros for the second criterion of 500,000 euros for the total of properties owned.

ELSTAT data also show that three-quarters of borrowers (75.3 percent) have no second home, while 50 percent have a main residence which is valued at no more than 137,000 euros.

These expanded criteria introduced by the ministry could strengthen the trend for the non-repayment of loans, just as the government has committed itself to creating an entity to handle bad loans.