The gradual maturation of the real estate market is bringing not only new products aimed at investors in the sector, but also changes to existing solutions that offer guaranteed returns to homebuyers.
With the new conditions emerging from rising interest rates, the guaranteed rental returns offered by developers are coming to the forefront.
Market sources tell Euro2day.gr that guaranteed returns are on the rise. About a year ago, returns were around 3%–4%, while now they are hovering around 5%. With inflation galloping and the cost of capital rising, yields are likely to climb to 6% in the near future, according to market estimates.
At the same time, fierce competition in the industry is driving real estate agencies to introduce new, innovative products aimed at securing exclusive listings.
Yields are on the rise
In the residential market, certain builders and development companies in Greece have long been offering guaranteed rental yields to attract low-risk investors.
This involves providing a guaranteed return on the property—that is, its ability to generate a satisfactory annual income.
A typical example is Resi Company, which is selling a 29-square-meter apartment in the Kallimarmaro area with a net rental yield of 5% for the next two years.
Offering a guaranteed return is a bargaining tool for developers. Not only does it help them close deals at favorable prices in an environment of steep price increases, but it also offers the opportunity to take over property management, thereby strengthening any asset management division they may have.
“To a large extent, market dynamics are what shape trends in guaranteed returns. Now, however, inflation and interest rate hikes are also playing a significant role. This will become even clearer if there are further increases in the coming months,” market sources say.
The “Battle” Among Real Estate Agencies
Meanwhile, the battle among real estate agencies is intensifying. A few days ago, the real estate platform UNIKO—51% owned by Qualco and 49% by the National Bank of Greece—made a new move in the market by launching the “Offer Submission Guarantee.”
This is a new product designed to ensure the exclusive listing of properties, meaning the home will not be offered for sale by other real estate agencies.
Within a specific period, UNIKO undertakes the obligation to submit at least one written offer within the agreed price range, said Christos Fouskoudis, CEO of UNIKO, at a meeting with journalists a few days ago.
It should be noted that the price range is determined by a property appraisal conducted by an appraiser from the National Bank of Greece.
“It’s a written commitment. We tell the client that if I do not bring you a written offer from a buyer with a deviation of up to +/- 10% of the price, then I am willing to give you an amount equal to 1% of the property’s value, up to 2,000 euros,” noted Mr. Fouskoudis.
It should be noted that, as part of the agreement, the National Bank of Greece (NBG) also provides free property certification, which includes a technical and legal inspection of the residence.