Hard to buy, harder to rent

The increase in the sale and rental prices of houses in Greece in recent years has been large and disproportionate to the disposable income of households, resulting in a significant financial burden on citizens, according to a QED survey on affordable housing on behalf of Alpha Bank.

The survey confirms both the large financial burden on households from the increase in rents and the difficulty of accessing the housing market due to the steep rise in prices in recent years. According to the survey, 54% of participants consider buying a house to be unfeasible today and 39% difficult to achieve, while 68% believe that rents are not affordable based on current wages. Correspondingly, 52% of tenants state that they pay more than 30% of their income on rent. Furthermore, 28% of renters responded that other housing expenses – besides rent – constitute more than 30% of their disposable income on a monthly basis.

Meanwhile, more than 50% of respondents had their rent increased in the last two years. This percentage amounts to 55% in Athens and 58% in Thessaloniki. In other large urban centers, the percentage is slightly lower. Also, overall, 45% of respondents reported rent increases of up to 10%, 30% between 10% and 20% and about 25% stated that their rent rose by 20% or more. At the same time, 60% of all respondents expect further increases in rents and housing prices within the next five years.

However, the percentage of tenants who have had an increase in their rents in the last two years is significantly higher on the islands (63%) – i.e. in areas with a higher percentage of the sharing economy than other areas.

“That supports the hypothesis that one of the factors contributing to the increase in rental costs is the increase in short-term rentals, as it provides an incentive for owners to withdraw properties from the long-term rental market,” Alpha reports, adding, however, that almost 800,000 homes are vacant in large cities and could offer a solution to the issue of reduced supply.