Land prices increase by up to 20.35% – In which regions of Attica are they in demand
If there was a “stability price” in the national real estate market, land would surely earn it. It is the only real estate category that has been little affected by the multiple crashes of the Greek economy over the past decade.
And the most interesting thing is that at that time, with a borrowing cost of around 5.50%, the lack of labor and the soaring prices of building materials, the plots know new glories.
It is telling that offsets in some cases have again recorded rates of over 40%, while everything shows that the pace of rising land prices is not going to stop.
Currently, land values in representative areas of Attica are at their highest level in a decade.
“The 10-year trend clearly shows that we are in an upward phase of the cycle, perhaps close to a new peak,” as pointed out by the head of Geoaxis, Mr. Yiannis Xylas.
Based on the relevant Real Estate Values Observatory, over the past 12 months, prices in five local markets of Attica (Ampelokipoi, Marousi, Paleo Faliro, Peristeri and Cholargos) recorded an annual increase of 5.31 %.
Indeed, compared to the 2nd quarter of 2021, the price increase reached 14.87%, revealing the dynamics of this particular market, while it should be mentioned that this year prices are increasing for the fifth consecutive year.
How prices are formed
The highest increase (6.30%) is recorded by plots with SD (Building Factor) 0.8 in Marousi, with an average price estimated at 810 euros per m², from 762 euros per m². Last year.
Next comes the Peristeri area where plots with SD 1.8 recorded an increase of 5.35% and an average price of 846 euros per m².
In Athens, more precisely in Ampelokipi, plots with SD 3.6 are sold instead for amounts of 2,282 euros per m², marking an increase of 5.16%, while in Paleo Faliro plots with SD 1.4 are valued at 1,395 euros per m², up 4.9% on an annual basis.
An increase of 4.85% is also noted by land for sale in the Cholargos region, where the average price is 1,125 euros per m².
As Geoaxis points out, these prices refer to very typical plots. “It is evident that plots with particular characteristics in terms of location, projection, view and area are at the upper limit of the sample, with values several times up to 25% higher,” says he.
The smallest plots are located in Ampelokipi (148 m²) and Peristeri (228 m²), followed by Paleo Faliro (273 m²), Marousi (330 m²) and Cholargos (400 m²). m).
According to analysts, it is evident that undeveloped one-acre plots are now hard to come by, when in most cases these plots contain old houses or other structures.
“We see that since the beginning of 2018 buildings are being constructed again, which are mainly located in medium and high profile areas (Agia Paraskevi, Paleo Faliro, Glyfada, Voula, etc.) where land has been purchased from low prices during the crisis and the compensation rates, once agreed, were not prohibitive, compared to the construction costs then.
These new buildings have the common characteristic of being largely self-financed and of offering high living standards in constructions with particular architecture, mainly in terms of views and energy footprint,” explains Mr. Xylas.
What are the reasons for the demand?
According to analysts, the main causes fueling the demand can be attributed to:
• In the accumulated housing demands that have not been met due to the economic crisis over the past fifteen years.
• In the immediate availability of capital (high liquidity) alongside the existence of undeclared income from the middle class.
• In the new reality of working from home.
• In the qualitative and technological obsolescence of a large number of buildings before 1980.
• In the inclusion of apartments in investment products.
• The possibility of obtaining returns through short-term rental.
• Desire to spread the investment risk, through the purchase of real estate.
One less apartment
Meanwhile, negotiations between developers and landowners are getting tougher, with higher selling prices for apartments being offset by rising construction and financing costs.
Landowners who kept their land after 2006 are still the big losers, because the total cost of building a building on land with consideration has increased significantly with the imposition of VAT from 1/1/2006 on deliveries of newly built properties, while ENFIA’s application loaded each design accordingly.
In general, compared to what was valid until 31/12/2005, today the owner of a plot will receive almost a small apartment less, in any case of a plot larger than 1,000 m².
The table of compensation rates at present in Attica compared to 2005 is as follows: in the region of Ampelokipi from 40-50% that the contractors gave now they give 33-38%, in Marousi from 45 -55% it fell to 32-38%, in Paleo Faliro from 50-56% it was reduced to 32-40%, in Peristeri from 30-40% it reaches up to 35%, while in Holargos from 45-52% the compensation rate was reduced in 2023 to 32-38%.