A slowly burning bomb of orphaned properties - 900,000 residential units closed across Greece - Economic Courier - ot.gr

In Greece, there are about 770,000 "orphaned" real estate properties, which can be compared to a slowly burning bomb ready to explode. Over the last decade, this number has significantly increased, and some tax authorities believe that the number of abandoned and disconnected properties could be close to 900,000, which accounts for 15% of the total real estate. Real estate experts note that the measures taken to address this issue have been superficial and ineffective. While rental prices remain unjustifiably high, creating a heavy financial burden on the population, hundreds of thousands of housing units stand empty, hindering the sustainable development of the country.

In response to questions from the publication "Vima," former Deputy Governor of the Central Bank of Greece Theodoros Mitrakas reported that after 15 years of stagnation in the construction sector, the total number of outdated and low energy-efficient buildings has reached 5.5 million. He specified that about 770,000 residential units are vacant, with 60% of them located in Attica. Approximately 600,000-700,000 properties with a total value...90 billion eurosare under lien for non-repayable loans.

Since the beginning of 2019, housing prices in Greece have been steadily increasing, while on the international stage, there is a contrasting trend of falling housing prices. Despite this, demand remains high, which also creates a tense situation in the market.

Starting November 1, the "express transfer" program will come into effect, increasing the need for incentives for active participation in the market. Mitrakas emphasized that since 2018, the Greek real estate market has significantly revived, recovering nearly 80% of the losses incurred during the crisis. However, prices for residential and commercial properties continue to rise, and rental rates are rapidly increasing. According to statistics from the Central Bank, in the last quarter of 2022, rental rates in...Athensincreased by13%, inThessaloniki— on11.2%...and in the regions of the country — on7.4%.

It is noteworthy that there are currently 100,000 properties "on the market," and the issue of vacant spaces requires a serious approach for their rational use. Most of these properties need major repairs and updates.

The President of the Attica Realtors Association, Lefteris Potamianos, also noted the increase in the number of vacant properties and the need to bring more housing to the market. According to him, there are many closed properties, and there are numerous reasons for this. For example, there are inherited properties whose owners are engaged in lengthy disputes, while others are mortgaged to funds and remain abandoned.

Government structures are also not staying on the sidelines. Some properties owned by various institutions are closed and will await further decisions. The Ministry of Social Protection is finally starting to actively work with state-owned assets to improve their utilization.

However, many closed sites are those that are in conflict with heirs or belong to funds, so from Potamianos' perspective, radical measures are needed to address these issues. For effective operation, it is necessary to establish a greater number of legal procedures, as well as to create a transparent system of control and obligations. It is also essential to develop new mechanisms for the swift resolution of existing long-term conflicts.

It is important to emphasize that the issue requires a comprehensive approach: necessary incentives for updating old properties, optimization of legal processes, as well as a detailed analysis of funds and their assets, which will ultimately help ensure balance in the real estate market.

According to the president of the Hellenic Federation of Property Owners, Stratos Paradias, it is necessary to implement a modern system of financial incentives for property owners with idle properties, as the lack of funds for renovating old buildings is the main issue. The country is facing urgent demands to modernize old buildings in accordance with new environmental standards.

These circumstances require government support, and the "Repairing - Renting" program, in particular, presents insufficient conditions for participation, which is an obstacle to completing construction and renovations.

An analysis of the problems in the housing sector conducted by the research center διαΝΕΟσις showed that the current situation remains quite complex and does not lend itself to quick solutions, especially in light of the dissolution of the Greek Housing Organization (ΟΕΚ) in 2012. Long-term housing policy in the country has remained marginal and has not contributed to the balanced development of urban areas.

Nevertheless, there is now an opportunity to revive housing policy with a focus on sustainable development and to move away from traditional structures that are solely state-managed, which will allow us to bypass current limitations and apply new methods of effective real estate management.