From 2008 to 2015, the picture in the real estate market in Greece was heartbreaking. According to PwC data, in the period 2008-2015, 15 billion euros of investments in construction were lost, while in the same period the price of housing decreased by 41%, the volume of transactions decreased from 2008 to 2014 by 72%, while the same At the moment property taxes have increased about six times.
But things started to change from the two years 2015-2016. “About a year ago I saw an important opportunity in the Greek market,” George Kachmazov, founder and manager of Tranio, a real estate investment company, told Fortune. “Before 2017, we focused mainly on the Spanish and German markets. However, due to the low real estate prices, we turned to Greece “.
For him, the Greek market and especially that of the center of Athens, offers the most investment opportunities that can be found at the moment compared to other European cities. And one of the factors that played a very important role is the rapid growth of tourism. “We mainly look at areas that are located around the Acropolis at a distance of 3-4 km. Anything that is in this area, we are interested.”
According to BoG data, property prices in Greece in 2017 decreased by only 1%, a percentage which is the lowest of the decade. It is characteristic that the average fall in real estate prices of the past eight years was 6.5% per year. Evidence shows that the stabilization of the real estate market sends a very positive signal to investors: The fall in prices has “slowed down” and the opportunity for profitable investment moves will not last long.
George Kachmazov focuses mainly on the historic center, around the Acropolis within a radius of 3-4 km. Neighborhoods such as Thiseio or Plaka are currently “close”, but places such as Lycabettus, Gazi, Koukaki, Mets, Metaxourgeio are on the “radar” of people who have already been in Greece for at least a year to “scan” the market and identify the opportunities they are looking for. As long as they are ready to accept the peculiarities of the Greek economy, the capital controls, and the fear of an “accident” that will deter investors.
“Of course there is a risk, but without risk you can not find an advantageous opportunity. What I see is that if you can buy cheap in Greece, the worst you can do is not make a big profit. But you will not lose money. This is in our interest, as in the bad scenario you will not lose, while in the good scenario you have a lot to gain “.
Expansion into new markets and the role of Golden Visa
Tranio started seven years ago as the link between -mainly- Russians who wanted to buy real estate in the Mediterranean and Central Europe. It cooperates with more than 500 companies, most of which are real estate agencies, and filters through its website the properties that are promoted for exploitation. It counts 10,000 visitors daily and the markets it targets the most are Russia, the Middle East, Europe, the USA and China.
“However, apart from the core of our business, which has to do mainly with real estate, we are also active in the management of funds. “We raise funds from investors we know, and we manage some of their investments.” Regarding the Greek market, George Kachmazov notes that most interested parties come from Russia, China, Turkey and a percentage from the rest of Europe.
For non-Europeans in particular, the Golden Visa program is a big lure. From 2013, when the program that provides residence permits to those investors from countries outside the European Union who buy real estate worth at least 250,000 euros, until September 2017 show that 2,014 permits were granted to foreign investors. China (850), Russia (388) and Turkey (161) were in the top three stakeholders.
Especially in the case of Turkey, Mr. Kachmazov notes a strong interest in buying real estate in Greece since the failed coup in the country. “We are not talking about moves as part of an escape plan, but securing an alternative. It is, in essence, a safety valve, an exit if things turn out badly. What is being said is that “if something bad happens, then I will leave.”
What an investor is asking for
“When an investor looks at Greece, he is looking for a lucrative deal. In fact, today there are fewer than a year ago “, notes the founder of Tranio. “We are talking about a market that has a great lack of capital. Of course, some things have changed. “Investors like me came, but the situation is much better compared to other big European cities.”
Among the most recent changes that brought about the resurgence of the real estate market, one would expect to be the interventions in practical issues which until recently discouraged an investor to throw his money in Greece. But, as George Kachmazov says, the issues of bureaucracy and high and complicated taxation remain. In addition, there is the huge issue of funding. He predicts, in fact, that if they unblock bank funds for investments, the real estate market “can grow by 20-30%”.
At this point, he identifies another Greek peculiarity: the lack of an organized market.
“In a big city abroad, there are detailed data which show that, for example, in a certain area with the postal code, property prices were moving at this level, the frequency of sales and purchases had a certain percentage, and so on. K. There is so much information and data about the markets. This is not the case in Greece. A building can cost 1,500 euros per square meter and the adjacent one can cost 3,000 euros per square meter, because one owner may have a large debt and the other may think he has a “diamond” which in a short time will be worth much more ».
To the basic question whether it is worth investing in Greece at the moment, the founder of Tranio answers “yes”.
He, along with a group of investors and associates, are currently willing to invest 10 million euros, while, as he says, the market return today reaches 7%. And if someone asked him what would be best to do with his investment, George Kachmazov answers that it would be better to keep the property for 1-2 years to use it, and then think about the possibility of reselling it. Everything, of course, depends on everyone's intentions.