The amount invested in 2022 in the housing market in Greece is estimated at 8 billion euros, showing the upward trend in demand and prices. It is surprising that such a high amount was spent on houses last year in Greece because banks in 2022 were not likely to finance 100% of the value of the property. Only 20% of purchases and sales of properties in Greece are made through bank lending.
Comparing to 2005 Greece
According to figures by the Bank of Greece, a grand total of €1.1 billion was given out in housing loans in 2022. Although this number is 42% higher than in 2021, the number is only 10% of the amount of money given in the early 2000’s, when there was a real estate bubble in Greece. More specifically, €12 billion was given out annually on average in the years from 2005-2007.
Bank Lending in Greece
For 2022, banks were estimated to finance 65% of the property value to be acquired. This means the total value of properties acquired with the help of a bank loan totaled €1.45 billion. Using the numbers given in the first paragraph, if this amount is 20% of the total, it means that the total value of investments made in the real estate market totaled €8.4 billion.
At the same time, €2 billion came from abroad for the purchase of real estate in Greece during this time period.
Financing Rates
The properties financed by banks have a low value typically. Looking at data from the Bank of Greece for the 4th quarter of 2022, total home loan disbursements were €337 million, an increase of 31.4% (year-on-year). 4,069 loans were given, and they had an average value of €82,700. The financing rate was 61% of the home value.
This means that when a property was acquired with a loan in Q4 of 2022, the average property value was €115,000.
However, during Q4 of 2022, the total investments exceeded €2.15 billion, if we count purchases financed only with equity capital.
