According to the quarterly survey by the Economic Analysis and Investment Strategy Directorate of Piraeus Bank, the composite Housing Sentiment Index stood at 43.6 points in the third quarter of 2026, down from 45.1 in the second quarter. It also recorded its lowest level since the survey began in the fourth quarter of 2023 and its largest annual decline, at 2.2 points. The index has remained below the 50-point threshold separating optimism from pessimism, after peaking at 48.1 points in the fourth quarter of 2024.
The property market outlook remains, in Piraeus’s words, “cautiously positive”. However, in the third quarter the vast majority of households shifted from positive to mildly negative expectations across all the survey questions. The bank’s economists note that it is risky to build an entire narrative on data from a single quarter.
If the shift is confirmed, however, it would be an initial warning sign that geopolitical uncertainty, energy insecurity, rising inflation and the ECB’s latest increase in borrowing costs are affecting households’ expectations for both the property market and the economy as a whole.
Income expectations fall below 50 points
The biggest shift was in the index of expectations for future household income, which turned negative for the first time. It fell to 46.9 points, from 51.5 in the second quarter and 55.7 a year earlier, an annual decline of 8.8 points. The series peaked at 59.5 points in the first quarter of 2025.
The picture is similar for households’ current financial situation. The relevant index fell to 49.3 points, from 53.6 in the previous quarter, and was down 3.9 points year on year. It had remained consistently above 50 points until the first quarter of 2026, reaching as high as 58.3.
Piraeus links the performance of both indices to the climate of geopolitical turmoil and rising inflation prevailing internationally.
Interest rates: record pessimism after the ECB’s pivot
The index of expectations for mortgage interest rates hit a low of 28.8 points, down 4.7 points year on year. The index moves in the opposite direction: the more households expect interest rates to rise, the lower it falls. The bank considers the decline “fully justified”, as the ECB raised its policy rates again, from 2% to 2.5%, with further increases to 3%-3.25% expected.
The finding, however, also conceals a paradox. Throughout the period from the fourth quarter of 2024 to the second quarter of 2026, the index remained below 50 points — meaning households expected rates to rise — while the ECB was cutting rates from 4% to 2%. In addition, 15%-25% of respondents consistently answer “Don’t know”.
According to Piraeus, the responses reflect either a lack of information or the entrenched perception that interest rates always move against borrowers, who see their mortgage repayments as a permanent burden. The bank highlights the need to better inform the public about how the ECB’s monetary policy feeds through to variable mortgage rates.
House prices are expected to keep rising
Moving in the opposite direction, the index of expectations for home purchase prices reached a series high of 74.1 points, up from 68.1 in the second quarter and 4.2 points higher year on year. The vast majority of households expect prices to rise over the next 12 months.
The bank describes the resurgence as “unexpected”, as it runs counter to the gradual slowdown in price increases recorded by the Bank of Greece’s house price index. As Piraeus notes, it remains to be seen whether this marks the start of a new cycle of rising price expectations or simply reflects households’ broader inflation expectations.
A seller’s market, with buyers on the defensive
Sentiment on the housing market has remained deeply negative throughout the survey. The relevant index stood at 12.8 points in the third quarter, while 60%-70% of households consistently described the period as “not at all favourable” for buying. According to the bank, the negative outlook appears to be becoming entrenched, reflecting a sense that housing is beyond households’ means or that a property fully meeting their needs is unaffordable.
By contrast, sentiment on selling is relatively positive, as high prices that deter buyers work in sellers’ favour. Some 40%-45% consider the period very or fairly favourable for selling. The index nevertheless fell to 50 points, its lowest level. Its stabilisation over the first nine months of 2026 suggests, according to Piraeus, that prospective sellers are waiting on the sidelines.
The survey
The survey has been conducted quarterly since the fourth quarter of 2023, using an online questionnaire (CAWI) sent anonymously to a random sample of Piraeus customers aged 25-75 across Greece. The results are weighted by region using the 2021 Census. The composite index is the average of six sub-indices — housing market and sales conditions, price and interest rate expectations, and current and future income — with 50 points as the neutral level, in line with the methodology used for PMI indices.