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, which offer guaranteed returns to home buyers.
With the new conditions being shaped by rising interest rates, guaranteed rental yields offered by developers are coming to the forefront.
Market sources tell Euro2day.gr that guaranteed yields are showing an upward trend. About a year ago, yields were around 3%-4%, while now they are moving in the region of 5%. With inflation soaring and the cost of money rising, yields are likely to climb to 6% in the coming period, according to market estimates.
At the same time, the sector’s fierce competition is bringing new innovative products from real estate agencies that have set their sights on the exclusive assignment of properties.
Yields are moving upward
In the housing market, certain constructors and development companies have for some time now been offering guaranteed returns in Greece on the leasing side, with the aim of attracting low-risk investors.
This concerns the provision of a guaranteed return from the property, that is, its ability to generate a satisfactory annual income.
A characteristic example is Resi Company, which is selling a 29 sq.m apartment in the Kallimarmaro area with a net rental yield of 5% for the next two years.
The provision of a guaranteed return is a negotiating weapon for developers. Not only does it help them close deals at an advantageous price in an environment of sharp price increases, but it also offers the possibility for them to undertake the management of the property, strengthening the asset management department they may have.
“To a large extent, it is the dynamics of the market that shape trends in guaranteed returns. However, inflation and interest rate increases now also play an important role. This will become even clearer if there are new increases in the coming months,” market circles say.
The “battle” of real estate offices
At the same time, the battle among real estate offices is intensifying. A few days ago, the real estate platform UNIKO, 51% of which belongs to Qualco and 49% to the National Bank, made a new move in the market by launching the ‘Offer Submission Guarantee’.
This is a new product aimed at the exclusive assignment of properties, that is, ensuring that the home is not offered for sale by other real estate offices as well.
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 is noted that the price range results from a valuation of the property carried out by an appraiser of the National Bank.
“It is 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 1% of the value of the property up to 2,000 euros,” Mr. Fouskoudis noted.
It is emphasized that within the framework of the agreement, free property certification is also provided by NBG, concerning the technical and legal inspection of the home.