Investment spending on construction projects fell to 9.0 billion euros in 2017, from 33.6 billion in 2007, the Foundation for Economic and Industrial Research (IOBE) said.
In a survey released on Monday, IOBE said investments on home building accounted for 0.6 pct of GDP in 2017, from 10.8 pct in 2007, while investments on other construction projects accounted for 2.0 pct of GDP in 2017.
An economic recession negatively affected investments on homes throughout Europe, but the fall in Greece was three times greater. Building activity remains stable at a very low level, with a total of 14,000 building permits issued in 2017, from 79,000 in 2007. The number transactions involving real estate assets was down 4.5 times compared with 2005 levels, while apartment prices fell 41 pct in the 2007-2017 period (the second largest drop in the EU-28).
IOBE said that property taxes accounted for 8.5 pct of tax revenue (2015 figures), up from an OECD average of 5.8 pct. The survey said that prices were down around 19 pct for the majority of buildings with an official value of up to 200,000 euros due to high property taxes. Property tax revenue totaled 5.7 billion euros in 2016, or 3.2 pct of GDP, from 1.9 pct of GDP in 2004.
The survey said that abolition of a supplementary property tax would significantly improve property yields, while abolition of a special property tax would raise households’ available income and boost consumption in the country. IOBE said that a lower tax on property could boost employment by more than 33,000 jobs in 2022.