Greece’s housing market is coming under renewed pressure as rising construction costs push up the price of new homes, complicating efforts to expand supply in one of Europe’s fastest-recovering property markets.
Builders and developers are warning of a fresh increase in construction expenses, driven by higher energy costs, geopolitical tensions and ongoing disruptions across global supply chains. The latest increases threaten to further inflate prices in a market already grappling with limited housing stock and strong demand for newly built properties.
Data released by Greece’s statistical authority showed construction material prices for new residential buildings rose 4.1% in April from a year earlier, accelerating from the 3.3% increase recorded during the same period last year.
The sharpest increases were linked to energy costs. Diesel prices climbed 26% year-over-year, while electricity prices rose nearly 14%, adding pressure across the construction chain. Costs also increased for key building materials including copper pipes, bricks, aluminum frames, concrete and steel reinforcement products.
The higher costs come as Greece’s residential market continues to attract domestic buyers and foreign investors seeking energy-efficient homes and newly developed properties, particularly in tourism-driven destinations and affluent urban districts.
The country’s most expensive market for newly built homes remains Mykonos, where average prices have reached around €8,000 ($9,000) per square meter, according to market data. In the Athens region, upscale neighborhoods such as Glyfada and Palaio Psychiko have recorded average prices of approximately €7,000 per square meter, while Filothei and the redeveloping waterfront district of Elliniko continue to command premium valuations.
Northern Greece has also seen price gains, with newly built properties along the seafront district of Thessaloniki approaching €6,200 per square meter.
Developers say one of the market’s underlying problems remains supply. Construction activity has recovered from the prolonged downturn that followed Greece’s debt crisis, but the pace of new housing development has struggled to match demand.
At the same time, buyers are increasingly favoring newer homes built within the last five years because of stricter energy standards and lower operating costs, widening the price gap between new and older housing stock.
The result is a market where rising construction costs are feeding directly into residential prices, adding another obstacle to housing affordability while reinforcing price growth in Greece’s premium locations.
