Greece Property Investment Soaring Following Major Infrastructure Improvements

Thanks to improved communications and transport networks, the Greek islands are experiencing tremendous growth in Greece property investment

Improved infrastructure and the massive regeneration investment carried out in preparation for the 2004 Olympics, coupled with the growing economy, and increasing tourism figures, have further strengthened Greece property investment as infrastructure is now able to sustain permanent residents and visitors, according to the Financial Times.

Latest figures show that year-on-year price growth has been 7% up to quarter 1 of 2007, with prices for apartments in Athens registering a 12% rise in the first quarter of 2006. During the period 1999 to 2002, Athens saw house prices increase on average by 164%. As prices have soared within the Grecian capital, demand for Greece property investment in areas within commutable distance to Athens has been particularly noticeable.

The Saronic islands are located within the closest proximity to the rapidly expanding capital city of Athens and have experienced dramatic expansion contributing to Greece property investment. Aegina, located within 50 minutes to the mainland, is increasingly popular with middle-income families for a summer escape, and a boom in the construction and services industries have created a substantial rise in jobs, which has lead to stimulation of the property market. Prices here have increased by around 20% year-on-year since 2003, according to Frosso Fouflia, a civil engineer for the Aegina municipality.

Spetses, steeped in patrician tradition, is another increasingly popular destination for Greece property investment, primarily presenting more upmarket, high-end properties. Growth of the property market in Spetses has been similar to Aegina, with property values rising by approximately 30% over the past 2 years, according to a local official.

Foreigner purchasers are now beginning to match domestic demand with some market analysts expecting the country to become a hotspot for overseas property investment with northern Europeans purchasing up to 1 million homes in Greece over the next decade. Angelos Seferiades, partner of developer Kihli Enterprises, commented “I believe there is a great pent up demand internationally for holiday homes in Greece”. 'A Place In The Sun' magazine found that Greece was the sixth most favourable destination for foreign buyers as a whole. Further supporting these predictions is the rise in the number of low cost airlines, such as GB Airlines who are now increasing their flights to Crete, Rhodes, Corfu and Mykonos. This will only help to stimulate demand for property and in turn push up prices.

Greece's real estate market compares favourably with other Mediterranean countries and the current period in the market is subject to significant growth. The Institute for Economic and Industrial Research (IOBE) has furthermore recognised that the bullish property market in Greece has made a significant contribution to the country's economic growth in the last decade, which can only bode well for its continued high performance.

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