Two-speed real estate in Attica: Why the south "beats" the north

The gap between the southern and northern suburbs of Athens is widening, as the prospects of real estate in the coastal zone of the capital greatly outweigh those around Kifissia.

Both foreign buyers and Greek investors alike are singling out the positives on offer in the southern suburbs, with house values soaring by up to over 40% in some cases in the last year.

"In the north, the market is moving at the pace of a turtle, when the south is running at the pace of a hare," Yannis Xylas, CEO of property valuation company GEOAXIS, told Businessdaily.gr. Although the two regions offer natural beauty, similar infrastructure and impressive residences, it is the south that takes the lead.

The project in Elliniko, the direct access to the beach and the relatively close distance from the capital's centre work in favour of the southern suburbs, experts stress. In addition, geography enhances the prospects of the real estate market in the southern suburbs. "In the south, future expansion further east towards Sounion is possible. The north is surrounded by three mountains, Parnitha, Penteli and Ymittos," says Xylas.

In areas such as Glyfada, Voula and Varkiza, buyer interest remains strong despite rising interest rates and limited supply. Market sources say that in land plots, developers are "hitting" prices aggressively, seeing the strong mood of buyers. "In the south there is a high profit margin for developers, something that does not exist in the north," Wood stresses.

This is a strong trend that is also reflected in prices. According to data from Spitogatos.gr, house prices in the southern suburbs in the first quarter of the year saw an increase of 13.2%, compared to 10.3% in the north. It is also noted that there was a similar picture in the second quarter in 2022, when prices in the south rose by 13.8% while in the north increased by 8.8%.

The bet of the northern suburbs

The more encouraging picture of the southern suburbs, compared to the northern suburbs, is among the conclusions of the latest report "Observatory of Land Values 2023" published by GEOAXIS a few days ago.

Looking at the various real estate categories, GEOAXIS says that land along with apartments, student residences, warehouses, Logistic Centers, Data Centers and retirement homes have proven in a pan-European context to be the most resistant properties to value declines.

"At the opposite end of the spectrum are shops, shopping centres and low-end offices. Our feeling is that despite the low yields they offer, land will be added as an important element in investors' portfolios in the coming years," the firm highlights.

"The rise in values is expected to continue over the next 12 months, but at a slower pace. By no means is the market experiencing bubble conditions, as the imbalance between supply and demand for newly built apartments is sustaining construction activity," she adds.

Despite the two speeds that appear in the land market, depending on the area where they are located, the general trend remains upward.

"The positive sign and the increase in values is also consolidated in 2023, since in all the study areas within the basin, an increase in potential land sale prices is recorded for the fifth consecutive year. The increase was measured at an average of 5.31% compared to Q2 2022. The rise in values is expected to continue over the next 12 months, but at a slower pace. A big gamble is the timing of the recovery in land values in the northern suburbs," the company explains.

It is noted that since the beginning of 2018, buildings are being raised which are mainly located in medium and high profile areas (Agia Paraskevi, Paleo Faliro, Glyfada, Voula, etc.) where plots were bought cheaply during the crisis and the consideration rates when agreed were not prohibitive in relation to the then construction costs. What these new buildings have in common is that they are largely self-financed and provide high standards of housing in structures of particular architectural design, especially in terms of their facades and energy footprint.