Indices of house prices and residential property transactions: Q3 2011

10/11/2011 - Press Releases

According to data collected from credit institutions, (1) nominal apartment prices are estimated to have declined on average by 4.1% year-on-year in the third quarter of 2011. For the first and second quarters of 2011, based on revised data, apartment prices fell at an annual rate of 5.3% and 4.4%, respectively, while for the whole of 2010 the average decline was 4.7% versus 3.7% in 2009.

Apartment prices by age and geographical area

More specifically, the decline of prices year-on-year in the third quarter of 2011 was greater for the "old" apartments, i.e. over 5 years old, (-4.7% compared with -5.6% and -5.4% in the first and second quarters, according to revised figures) than for the "new" ones, i.e. up to 5 years old (-3.0% against -4.8% and -2.8% in the first and second quarters).This observation is also valid for 2010 as a whole, when the average annual rates of decline in these categories (revised data) were 5.0% and 4.2%, respectively, and even more so for 2009 (“old”: -4.8%, “new”: -2.0%). The stronger decline in the prices of "old" apartment reflects the relatively stronger persistence of newly-built apartment prices, as these buildings are generally available for sale by construction firms.

According to data broken down by geographical area, apartment prices are estimated to have declined in the third quarter of 2011 by 4.3% year-on-year in Athens, 6.7% in Thessaloniki, 3.5% in other cities and 3.1% in other areas of Greece. For the first quarter of 2011 the respective revised annual rates of price reduction in the abovementioned areas were 6.1%, 7.9%, 4.0% and 3.8%, while for the second quarter of 2011 they were 6.8%, 4.3%, 3.4% and 0.2%, respectively. For the whole of 2010, apartment prices registered the strongest decline in Thessaloniki (-7.4%) and other areas of Greece (-5.8%), which include secondary residences or holiday homes (Athens: -3.2%, Other cities: -5.3%).

It should be noted that, in addition to house prices by geographical area (Athens, Thessaloniki, other cities and other areas), two detailed tables are published in the Bulletin of Conjunctural Indicators (Tables II.7.1 and II.7.2), with a further distinction between “new” (up to 5 years old) and “old” (over 5 years old) apartments. These tables are also available at the Bank of Greece’s website.

Indices of residential property transactions-appraisals (2)

The number of residential property transactions-appraisals conducted with Monetary Financial Institutions (MFI) intermediation for any reason (renegotiation of existing loans, registration of a mortgage to back non-housing loans, debt transfers from one bank to another, etc.) came to 9,124 in the third quarter of 2011, compared with 12,707 and 11,710 in the first and second quarters of 2011 (revised data). Year-on-year, the number of residential property transactions-appraisals fell by 42.1% in the third quarter of 2011. The number of transactions-appraisals in 2010 reached 74,457 (final figures), declining slightly by 0.2% compared with the previous year (2009: 74,586).

The volume of residential property transactions-appraisals (measured on the basis of total square metres) declined by 40.5% year-on-year in the third quarter of 2011 (first and second quarters of 2011: -44.1% and -34.6%, respectively, according to revised data). For the whole of 2010, according to final data, this volume declined at an average annual rate of 0.1%, compared with 38.9% in 2009.
Finally, the value of residential property transactions-appraisals conducted with MFI intermediation dropped by 40.5% year-on-year in the third quarter of 2011 (first and second quarters of 2011: -44.4% and -33.2%, respectively, according to revised data). In 2010, the average annual rate of change was -6.2% (final data), against -40.0% in 2009. The fact that the volume and value of residential property transactions-appraisals during the current economic crisis have fallen more than the number of transactions-appraisals reflects the shift of buyers’ preference towards smaller and more affordable properties.

INDICES OF APARTMENT PRICES⁽¹⁾
(2007=100)
	2009	2010		2011 *
	average	Q4	average	Q1*	Q2*	Q3*
Ι*. Summary*
Price index	97.9	90.9	93.3	91.3	90.1	88.2
Change over previous year	-3.7%	-7.0%	-4.7%	-5.3%	-4.4%	-4.1%

*II. BY AGE*
1. New (up to 5 years old)
Price index	100.2	93.5	96.0	94.2	93.5	92.3
Change over previous year	-2.0%	-7.6%	-4.2%	-4.8%	-2.8%	-3.0%
2. Old (over 5 years old)
Price index	96.5	89.2	91.7	89.4	88.0	85.6
Change over previous year	-4.8%	-6.6%	-5.0%	-5.6%	-5.4%	-4.7%

*ΙΙΙ. BY GEOGRAPHICAL AREA*
1. Athens
Price index	96.3	90.8	93.2	90.2	88.3	87.1
Change over previous year	-4.6%	-5.8%	-3.2%	-6.1%	-6.8%	-4.3%
2. Thessaloniki
Price index	95.4	86.2	88.4	84.8	85.0	80.6
Change over previous year	-6.0%	-10.1%	-7.4%	-7.9%	-4.3%	-6.7%
3. Other cities
Price index	99.0	91.8	93.7	92.8	91.3	88.7
Change over previous year	-2.7%	-7.7%	-5.3%	-4.0%	-3.4%	-3.5%
4. Other areas of Greece
Price index	101.3	92.2	95.4	94.7	94.8	93.2
Change over previous year	-1.9%	-7.2%	-5.8%	-3.8%	-0.2%	-3.1%


INDICES OF HOUSE APPRAISALS-TRANSACTIONS WITH MONETARY FINANCIAL INSTITUTIONS INTERMEDIATION ⁽²⁾
1. Transactions
Number of transactions	74,586	15,610	74,457	12,707	11,710	9,124
Change over previous year	-35.7%	-35.6%	-0.2%	-47.9%	-37.4%	-42.1%
2. Volume of transactions (total m²)
Volume index (2007=100)	46.7	40.7	46.7	33.0	30.5	24.0
Change over previous year	-38.9%	-31.1%	-0.1%	-44.1%	-34.6%	-40.5%
3. Value of transactions
Value index (2007=100)	48.0	39.6	45.0	32.4	29.5	22.6
Change over previous year	-40.0%	-33.7%	-6.2%	-44.4%	-33.2%	-40.5%

* Provisional data.

Source: Bank of Greece.

(1) Bank of Greece indices of house prices and of the number and volume of residential property transactions use detailed data reported to the Bank of Greece by all credit institutions operating in Greece. These data are compiled by the Real Estate Market Analysis Section of the Bank of Greece as from 2009, under Bank of Greece Governor’s Act 2610/31.10.2008 and include banks’ appraisals of the current market value and qualitative characteristics of residential property. A total of about 558,744 appraisals were reported to the Bank of Greece (by end-October 2011) (68.1% concerning apartments, 19.0% houses, 5.7% maisonettes, 5.3% building plots and 1.9% other types of property).

(2) The indices of residential property transactions are based on appraisal reports by banks’ engineers regarding the value and qualitative characteristics of residential property whose purchase is financed or which is used as collateral for loans extended by credit institutions. Part of these appraisals may not be associated with residential property transactions, but concern the renegotiation of existing loans, registration of a mortgage to back non-housing loans, debt transfers from one bank to another, etc.