by Symela Touchtidou, @stouchtidou

Undoubtedly, tourism is one of the sectors hardest hit by the global pandemic crisis.

There is one sector, though, that has showed remarkable resilience to the pandemic crisis and is expected to boom when restrictions are lifted.

The holiday home market. Why?

As many tourism experts note, traveler preferences and behaviors have shifted toward the familiar, predictable, and trusted.

“Throughout 2020, the interest of potential buyers for holiday homes remained unchanged,” John Revithis, CEO of the Real Estate Group Revithis and Partners, told Greek Business File. “The vast majority (around 80–85%) come from abroad. Most of them are interested in having a holiday home of their own, but there is also a part (around 20%) of them that see an investment opportunity. But in order to buy the home, they need to see it first. This is why the growing demand has not been turned into sales yet. But once restrictions are lifted, we expect sales to boom. It is just a matter of time.”

Source: “COVID-19 Industry Pulse Report: Tourism”, EY Greece

Source: “COVID-19 Industry Pulse Report: Tourism”, EY Greece

J. Revithis deals with properties in most of the Greek islands. He says that the most popular are Mykonos and Santorini, followed by the rest of the Cyclades islands, the Ionian Sea islands, Crete and Skiathos. Revithis told GBF that the pandemic has accelerated an already rising trend.

Holidaymakers choose more “private” residencies to spend their time off: they either rent villas or look to buy their own holiday home.

Artemis Mavraki

Artemis Mavraki, president of the Greek Realtors Federation and owner of a real estate agency in Crete, shares the same impression. “I see two rising trends. The first, people opt for more private residencies, for example Airbnb apartments, to keep away from places where many people gather, i.e., hotels. We have already seen that happening in the 2020 tourist season. Moreover, I believe that, once we return to normalcy, people will look to buying their own holiday home to enjoy more ‘personalized’ holidays.”

It is a global trend

The “COVID-19 Industry Pulse Report: Tourism” by EY Greece notes that, in 2020, contrary to the fall of the global hotel investment volume, “the global holiday home market demonstrated relative resilience during the pandemic, increasing the attractiveness of high-end residential properties in the countryside and sea front locations”.

 

Furthermore, “holiday home capital values (i.e. asking price) have recorded a 1.6% growth during H1 2020, in major tourist destinations, such as Mykonos, Paros, and Santorini (Source: Geoaxis),” the report says.

According to information provided by realtors, current average prices for newly constructed holiday properties range (depending on proximity to the see):

  • In Mykonos and Santorini: €3,000– 8,0000 per square meter
  • In other Cyclades islands: €2,000– 5,000 per square meter
  • In Crete: €2,000–3.000 per square meter

Source: “COVID-19 Industry Pulse Report: Tourism”, EY Greece

To build, you need an (urban) design

In Halkidiki, the Northern Greece region that is particularly popular with the Balkan and Russian tourists, sales have kept up to the prepandemic levels.

Gregory Stivachtaris, president of the Real Estate Agents of Halkidiki, says that the market held its ground during 2020, despite the fact that many buyers could non finalize their purchases due to the pandemic restrictions.

“There are a lot of deals that the interested parties did not manage to conclude. Deals that have reached the final stage and all is left is the signing of the contracts. What I see is that the holiday home market, not just in Halkidiki but in Greece in general, will skyrocket in the coming years. And it will bring huge revenues to the state coffers.”

As Stivachtaris notes, the Greek state can greatly profit from the rising market, as long as it helps it evolve.

“The state must cut the bureaucracy around real estate transactions and make procedures more digitized and flexible. What happens now, is that investors (especially from abroad) are discouraged by the vast amount of paperwork required to fulfill a sale. Secondly, there is a major issue with the infrastructure of the newly built settlements. For example, here in Halkidiki, the road network, the water supply network, bin collection and recycling are highly problematic. We also need to modernize the electricity network, incorporating more renewable sources in the local grid. In Halkidiki, for example, we can barely host the current number of visitors coming during the summer months. These steps are absolutely necessary to ensure top quality of the hospitality services we provide. They are also necessary to safeguard sustainable and environmentally friendly growth.”

This article was published in the the January/February 2021 issue of Greek Business File, available here.