Return of the loan or rent dilemma


The dilemma between paying a monthly mortgage or rent that preoccupied hundreds of thousands of households during the 1990s and 2000s has, albeit tentatively, reappeared.

The question arose with the gradual return of banks to the mortgage market and the stimulation of buying interest, which led to an increase in these transactions compared to a few years ago.

Considering the increase in rental rates as well as selling prices, potential buyers are advised to consider several factors.

However, what is undoubtedly is that the number of households concerned about this dilemma is much lower compared to the period before the financial crisis.

As an indication, according to the Bank of Greece in the 2000s, 85% of home sales were financed by mortgages. At the same time, housing market transactions ranged from 90,000 to 150,000 properties for most of the decade.

The data today is completely different, given that about three in 10 home sales are financed by bank loans, which is part of the reason why transactions do not exceed 25,000 to 35,000 on an annual basis. .

However, those who opt for a loan and have it approved will usually have to finance out of equity, a percentage of 15-30% of the total value of the property to be acquired.

However, owning a home is still beyond the reach of the average person.

According to Giorgos Giokas, commercial director and co-founder of IMS (Individual Mortgage Solutions), which operates in the mortgage market, the average mortgage loan disbursed is between 110,000 and 120,000 euros, an increase of 15-20% compared to 2019, when it was set at 100,000 euros. This increase reflects the corresponding increase in the prices of homes sold. Based on this data, the average monthly loan payment over 30 years is around 550 euros.

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