According to statistics from the Bank of Greece, 2017 saw decade-high foreign capital inflows of EUR 503 million for the acquisition of real estate, an 86.5% increase from the previous year. In fact, 2016 was also a record high during the Greek financial crisis, at EUR 270 million, compared to EUR 186m in 2015, EUR 250m in 2014, EUR 168m in 2013 and EUR 113m in 2012.
Meanwhile, further strengthening investor confidence in Greece, a newly formed investment fund announced its plans to invest EUR 200 million in the Athens real estate market. Greek Real Estate Company Fund (Greco Fund) which won its first bid in the Ethniki Leasing auction for two properties at EUR 25.95 million, is planning on investing in prime locations on Kifisias and Vasilissis Sofias Avenues before exploring investment opportunities in tourist developments. Greco Fund is a partnership between Dromeus Capital based in London, and Crossborder Capital based in Zurich.
Statistics show that this period is the first time where Greek real estate is attracting real foreign investment, with varying categories and investor nationalities. According to Kathimerini, the underlying reasons are the high profits attainable from short-term rentals in the city centre and seaside neighbourhoods, the opportunity to obtain a Golden Visa (by investing at least EUR 250,000), and a sustained wave of those who are attracted to Greece for holiday homes.
According to Enterprise Greece, 2017 saw a 33% increase in Golden Visas issued (773 compared to 582 in 2016). Promisingly for applicants, the speed at which the applications are processed has recently increased, as by the end of November 2017 no more than 560 visas had been issued. From 2013 till 2017, 2,305 Golden Visas had been issued to 5,699 people including the family members.
At Fractal Property Development we believe that the Athens real estate market is on the rise because it is finally going global. Up until the financial crisis, the Greek real estate market was primarily Greek-owned, and therefore took a big hit as the economy collapsed. Now that Athens is turning into an international real estate market, we believe that foreign investors, together with returning expats and Greek buyers returning to the market as the economy recovers, will drive the prices, in some areas, higher than they were at their peak.