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Apart from a chance to pick up cheap assets that could have long term — very long term — upside possibilities, there could be other reasons why Greece realty holds value for overseas investors.
“If you want to retire or have a long term (plan) in place to stay in Greece, the coming period could offer a good opportunity to buy,” said David Godchaux, CEO of Core Savills. “In such cases, buying property does make you eligible for a long-term residency permits.
“If you are looking at Greece as a portal to the EU, however, there are certainly other options, since an exit would most likely result in restricted borders. If access to EU is the goal, it makes sense to pursue opportunities in other EU states such as Cyprus, Malta or Portugal.
“Given the current situation, it would not be advisable for anyone looking for EU-wide benefits to consider Greece since the country has a long road ahead in terms of fixing its economy and avoiding the many pitfalls which lay ahead.
“It all depends on how the relationship between Greece and EU develops over the coming period and the results of the referendum which will shape policy … and possibly see a change of leadership in the country.”
There certainly may be a few “distress sales” by individual sellers who are in financially precarious positions, however the vast majority of UAE and GCC-based high net worth investors will not be looking to exit the market when it is facing such uncertainty.
In any case, prime real estate, villas and holiday homes hold value to high net worth individuals which transcends a monetary figure, and in any case if you were to sell now you would be selling an asset at a significant discount to offload it quickly.
The situation may be different for institutional investors and the owners of commercial property, however, and would depend of whether Greece exits the Eurozone. If it does exit, Greece’s new currency would depreciate fairly quickly and prices relative to the Euro and Dollar would plummet as well. Prime real estate however, will not depreciate as quickly and will sustain themselves better in relation to the overall economy. If an investor is convinced of a Eurozone exit they may be compelled to sell off their property before a new currency is put in place, in order to conduct the transaction in euros.
Our advice, however, is that this is not the right time to exit or enter the market since the situation is currently highly speculative.
Source: Manoj Nair, Associate Editor, gulfnews.com