Without doubt experts involved in the Cretan construction business know that they will be affected by the current crisis, but not as deeply as some other locations. Most experts predict that, although the extraordinarily healthy capital appreciation seen in the past few years of 15% or more in some cases will slow down, the prices of houses on Crete will continue to see growth. This is due to several factors including the strict building regulations causing the scarcity of attractive, buildable land and consequently its continual rise in value.
It has also been suggested that property prices in Crete and Greece generally continue to rise due to a wiser approach by mortgage banks in the country. Traditionally lending in Crete has been tighter than in the UK. Until relatively recently it was almost impossible for prospective house buyers in Crete to secure a mortgage which means a property bubble fuelled by extensive lending was not created in Crete as opposed to some other countries. In the last quarter of 2007, the average Greek household debt was 45.3% of the GDP, compared to 97% in the UK. Now of course thankfully mortgages are accessible to residents and non-residents alike, but Greek banks have never been drawn into the somewhat irresponsible lending seen in other countries. While mortgages in the UK are becoming scarcer Greek banks are still offering non-resident purchasers interested in buying a home in Crete attractive mortgage packages. Greek banks continue to help a lot of house buyers realise the dream of owning a property in Crete despite the weaker pound. Subject to status and the type of real estate to be purchased some Greek banks can offer rates as low as 4.20% fixed rate for 3 years.
Overall, it seems that Crete property provides an enduring investment for those wishing to survive the credit crunch and now that mortgages in Crete have become more readily available this can only increase the demand by people looking to buy a house on Crete. Add to that the wonderful Cretan cuisine, enviable climate, friendly local people and awe-inspiring natural beauty and surely Crete will remain a major property investor magnet for many years to come!
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