Its real estate price index showed downward pressures
intensified from a revised 4.1 percent drop in the third quarter.For the whole of 2010, apartment prices fell 4.0 percent following a 3.7 drop in 2009. Although property accounts for a quarter of total investment in Greece and 82 percent of household wealth, there had been no widely accepted benchmark for systematically monitoring real estate prices until the Bank of Greece launched its index in 2009.
The latest data showed price pressures were more pronounced at new apartments, defined as those less than five years old, where the drop reached 8.1 percent in the last quarter and averaged -4.4 percent for the year as a whole versus -3.8 percent for older flats, the central bank said.
Prices fell more in Greece's second-largest city of Thessaloniki, down 9.0 percent, compared with Athens where the fall was 5.1 percent in the fourth quarter.
Hit by a severe debt crisis, Greece's economy has been in a recession since 2009, with economic activity contracting by 4.5 percent last year, topping government forecasts.
Greece has one of the highest home ownership rates in western Europe -- 80.1 percent versus 70.4 percent in the European Union as a whole -- according to European Mortgage Federation data.
An earlier uptrend in Greek residential property prices, fuelled by cheap credit after the country joined the euro zone in 2001, slowed to 1.7 percent in 2008 from 4.6 percent in 2007, 12.6 percent in 2006 and 10.9 percent in 2005.
Based on EU Commission statistics, construction accounted for 10.7 percent of gross domestic product (GDP) in Greece in 2008 and for about 8.7 percent of total employment.
The Bank of Greece provided the following data:
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GREEK APARTMENT PRICE INDICES
2008 2009 Q3 2010 Q4 2010
Index 101.7 97.9 93.1 92.2
Change (%) 1.7 -3.7 -4.1 -5.7
New (up to 5 years) 102.3 100.2 95.2 93.0
Change (%) 2.3 -2.0 -5.0 -8.1
Old (older than 5 years) 101.3 96.5 91.7 91.7
Change (%) 1.3 -4.8 -3.4 -4.0
