By Niko H. Rousanoglo
The first major price increases in construction materials for new residential buildings are already becoming visible, driven largely by soaring fuel costs over the past two months, according to property market executives in Greece.
Speaking at the 19th RED Meeting Point conference, Fotis Gioftsios said construction costs have already risen by around 25%, while some suppliers are also taking advantage of market uncertainty to increase profits.
“We are already seeing 25% increases in construction costs,” Gioftsios said. “As usually happens during extraordinary situations like the current one, speculative practices are also appearing among some suppliers trying to maximize their profits.”
The comments highlight growing concerns across the wider property and construction sector as geopolitical tensions and volatile oil prices begin filtering into everyday housing costs, something likely to resonate with many Cypriots already struggling with rising prices and expensive real estate.
Gioftsios said the uncertainty is so intense that supplier quotes, which until recently remained valid for 40 to 45 days, are now lasting only 24 to 48 hours due to constant fluctuations in oil prices.
“It is obvious we will see the impact on the market in the coming months,” he said.
The effect, however, is not expected to hit all projects equally. Developments nearing completion are likely to face smaller increases, while projects just starting construction could be significantly affected.
Some developments may even be temporarily postponed until conditions stabilize and geopolitical tensions ease, industry officials said.
Despite the uncertainty, Giannis Gkanos said demand in the real estate market remains strong for now.
“We are not seeing anything alarming in the near future unless there is some unexpected development,” he said, noting particularly strong demand for homes, office spaces and logistics properties.
But beneath the strong demand, housing trends are also changing.
According to Andreas Protopapas, which operates in the housing finance sector, today’s homebuyers look very different from those before the financial crisis.
Between 2000 and 2007, most buyers were in their 30s, often young couples purchasing their first home. Today, buyers are typically at least 10 years older, mostly aged 40 and above.
Another growing problem is the age and quality of available housing stock.
“About 90% of available homes are more than 35 years old and do not offer modern features such as high energy efficiency,” Protopapas said, adding that many properties no longer meet current buyer expectations.
He noted that most borrowers today are dual-income households where both adults work, while demand is also rising for investment properties from both foreign buyers and Greeks living abroad.
Single-parent families are also becoming a growing segment of the market, increasingly searching for smaller and more affordable homes over the past two years.
