The pressures that have developed in recent years in the housing market, with large increases in rents and rising property purchase prices, have made it difficult for Greek households to access affordable housing, according to an Alpha Bank study.

House prices have recovered rapidly since 2018, recovering almost all of the losses of the recessionary period. This, combined with low construction activity during the crisis, strong external demand and the expansion of the sharing economy in recent years, have intensified the pressures.

According to the survey results, the majority of respondents consider it impractical to buy (54%) and rent at market prices (68%) today. Participants’ pessimism is in line with their financial situation, with more than half (54%) stating that they are just managing to cover basic living expenses without being able to save, while 11% responded that they are not even managing to pay for basic/daily expenses.

For renters specifically, the survey results reveal that 52% spend more than 30% of their disposable income solely on paying rent. For those who own their own home and pay a mortgage, the corresponding figure is 42%.

In terms of expectations, 6 in 10 Greeks believe that house prices and rents will continue to rise over the next five years.

The expansion of short-term rental properties seems to play a key role in shaping expectations for house prices, especially in tourist areas. In particular, over 50% of respondents believe that the growth of the sharing economy is one of the most important factors influencing future house prices and rents, along with government/tax policies, interest rates and access to finance.

Intention to buy a home in the next two years was reported by only 12%. Focusing on the individual interest groups, this is 28% for young people living with their partner and 21% for married couples renting their current home.

The limited supply of housing within budget is a key concern among prospective buyers, highlighting the growing challenges of affordable housing.

According to the study’s findings, although a number of government policies have been implemented in recent years to address the housing crisis, in order for these policies to be effective, it is important to incentivise and facilitate the return of vacant homes to the market.

To address the imbalance between increased demand and limited supply, measures such as: (i) further customization of the Golden Visa framework; (ii) boosting construction activity; (iii) thoroughly reviewing and recording the debt waivers during the financial crisis; (iv) restarting housing policy in a sustainable manner, (v) more drastic measures to make use of vacant buildings where possible, and of course (vi) further regulation of short-term rentals so that a sufficient number of properties return to the long-term rental market, but also initiatives aimed at stimulating financing for housing.