Greece’s Housing Market Gridlocked by Bureaucracy, Say Banks and Servicers

Greece’s banks, loan servicers, and investment funds currently hold an estimated 25,000 properties, according to official data. Yet most of these remain unsold, prompting the government to accuse the asset managers of deliberately holding back supply in a bid to extract higher profits.

The result, officials argue, is a limited housing stock that fails to ease soaring demand—especially from abroad—driving prices even higher and making homeownership unattainable for younger households.
However, both banks and servicers strongly reject this claim.

Fokion Karavias, CEO of Eurobank, firmly counters the government’s position, stating that financial institutions have every incentive to sell these assets as quickly as possible. He points the finger back at the state, arguing that it is government-imposed conditions, particularly those tied to property legalization and digital registration, that are delaying sales.

Under current rules, properties must be fully legalized in terms of planning permissions, zoning, and other regulatory requirements before they can be transferred. Banks and servicers can acquire them as-is but can’t resell until all issues are resolved.

This regulatory bottleneck, Karavias insists, is the true cause of the limited supply on the market. He notes that legalising properties and securing digital IDs is a long and complex process, often dragging on for months or even years.

Eurobank and others have suggested allowing property sales without prior digital registration, transferring the responsibility to buyers—but the Finance Ministry has rejected the proposal. Karavias criticises the rigid stance, especially given that only a small fraction of Athens’ housing stock currently has a digital ID.

Theodore Kalantonis, head of doValue Greece, also proposed shifting responsibility for legalizing properties to buyers for a year to help ease supply pressures. He warns that lengthy red tape delays sales and that mortgage approvals now take six months—far longer than the 45 days needed before the crisis—often stalling deals.

Kalantonis warns that mounting delays risk undermining Greece’s edge in real estate, once known for fast deals. He urges the government to cut red tape, starting by letting buyers handle property legalisation and digital IDs, to ease the country’s housing crisis.