Alpha Bank Predicts Continued Property Value Decline

In its study, the Bank's analysts stated, "The property market's recovery is expected to be relatively delayed, as it mainly depends on a normalization of the taxation regime, but also on the restoration of confidence in the prospects of the economy's recovery and growth, on a steady strengthening of household incomes and a significant rise in stable employment", as reported by Kathimerini.

The weekly financial report added, "Overall, the significant slowdown in the downward trend for apartment prices in the first half of 2014 also signals a slowdown in prices for the year as a whole, at around -6.3 percent. The prospects of apartment prices stabilizing are significantly strengthened from 2015, particularly if the forecast for real GDP growth of 2.9 percent proves correct".

Even with the already lowered property costs and many residences available on the market, acquirements continue to decline. As reported in Alpha Bank's document, home purchases are waiting out for a further reduction, while sellers believe that prices won't additionally drop.

The average time a house remained on the market in the start of 2014 stood at approximately one year, in comparison to 2009's five month average. Bank assistance by home buyers declined from 5,121 in 2013's second quarter, to 4,008 in the first quarter, and dropped to 3,003 in 2014's second quarter. This reveals a sharp contrast when compared to 2007's figure of 148,100 and 2012's 30,900. The Alpha Bank analysis reconfirmed that the real estate market has an overabundance of homes with little demand.