Dear readers,
With the holidays behind us, the sounds of war fading, and only a few hostages remaining in Gaza whom we hope will also return to Israel soon, we are approaching the end of the calendar year and the year-end reviews. Just as the real estate market in Israel has experienced volatility over the past year, the international markets also seem to be experiencing volatility, and yet we are still seeing high interest among Israelis in buying property overseas. Will the expected interest rate cut, and the stagnation - and some say price decline - in Israel, bring investors back to the Israeli market, or will we continue to see investors looking for alternative investment channels abroad?
This month we would like to draw your attention to:
A. Greece - the IMF forecasts growth of 2%.
B. S&P confirms Greece's economic stability.
C. Greece in a housing crisis: a supply shortage is pushing real estate prices to new records.
D. Colliers: the Romanian real estate market is entering a cooling period.
E. Romania - a golden visa?
F. Storia: apartment prices in Bucharest rose by 70% over the last 6 years.
G. Cyprus - the real estate market is reaching maturity.
Adv. Ilan Leibovitch and the office team
Greece
The International Monetary Fund forecasts steady 2% growth for Greece amid global volatility
The International Monetary Fund (IMF) forecasts growth of 2% for the Greek economy in 2025 and 2026, a modest decline from 2.3% in 2024 but still above the eurozone average, according to its latest “World Economic Outlook” report.
The IMF warned that global growth faces significant difficulties. Trade tensions, especially US tariff policy, volatile macroeconomic adjustments and fading short-term stimulus effects pose risks. The report forecasts a slowdown in global growth from 3.3% in 2024 to 3.2% in 2025 and 3.1% in 2026, with advanced economies growing by about 1.5% and emerging markets maintaining growth of slightly above 4%.
For Greece, the forecast offers a mix of cautious optimism and structural challenges. With key economic indicators moving in the right direction, the country may benefit from ongoing reform efforts, but it remains vulnerable to external economic shocks.
S&P confirms Greece's economic stability
The global rating agency S&P Global reaffirmed Greece's credit rating at BBB with a stable outlook, signaling continued confidence in the country's economy and long-term growth prospects.
This confirmation strengthens Greece's standing among international investors and tourism operators, who see the country as a stable and attractive destination for long-term cooperation and tourism investment. Improved competitiveness is expected to attract more capital and ease access to financing for infrastructure upgrades, thereby further improving Greece's tourism and business environment.
S&P stated that Greece is among the few advanced economies expected to reduce public debt in absolute terms for the second consecutive year, and forecasts an overall fiscal surplus in 2025.
“Greece's economic outlook remains strong, supported by investment programs and robust tourism demand,” the agency noted, adding that the stable outlook reflects solid performance balanced against still-high debt levels.
The agency expects Greece's real GDP to grow by 2.1% this year and to average 2.2% annually between 2025 and 2026, led by investment and private consumption. The steady decline in unemployment and rising real wages are also expected to support domestic demand. Growth is expected to slow gradually once funding from the Recovery and Resilience Facility (RRF) expires in the coming years.
Despite global uncertainty, S&P described Greece's fiscal outlook as resilient. While industrial production remained unchanged in the first eight months of the year due to weaker European demand and lower exports, tourism revenues rose by 12.5 percent through July compared with the same period in 2024, underscoring the sector's continued strength.
Greece in a housing crisis: a supply shortage is pushing real estate prices to new records
The Greek real estate market continues to simmer, and this time the cause is not only high demand but an acute supply shortage. According to a comprehensive report in Greek Reporter, Greece faces a deepening housing crisis, which is leading to a steady rise in apartment prices and growing pressure in the rental market as well.
In the first half of the year there was a 14% decline in the number of building permits compared with the previous year, alongside a 24% drop in built area and a 17% drop in total construction volume. The meaning is clear: less new construction - fewer new apartments - and supply that keeps tightening.
The result is clearly visible in the price data. In the second quarter of 2025, apartment prices in Greece jumped by an annual average of 7.3%. New apartments rose by 6.8%, while older apartments jumped at a faster rate of 7.6%. In Athens there was an average rise of 5.9%, but in northern areas such as Thessaloniki and the periphery, sharper rates of increase were recorded, around 8.8% a year.
Tension is also felt in the rental market: the national rent index rose to 114.7 points, an increase of almost 10% compared with last year, which indicates strong demand for housing and a growing gap between the number of potential tenants and the number of properties available for rent.
The article points out that the Greek real estate market is entering a stage where “prices are rising not because of excess demand, but mainly because of a lack of supply.” Government officials were quoted as saying that this trend threatens to harm the middle class's ability to buy an apartment, and is sparking a new public debate around incentives for new construction and restricting short-term rentals (Airbnb and the like), which take apartment stock away from the local market.
At the same time, the continuing rise in prices is drawing the attention of foreign investors. According to estimates, the share of international buyers in central Athens already crosses the 40% mark of all transactions. For them, this is a developing market with significant capital-gain potential - but one that requires caution, local understanding and careful risk management.
From the writer's desk:
Potential for the Israeli investor
- The steady rise in prices (about 7% a year on average) points to a market with positive dynamics for investment and rental income.
- Areas such as Thessaloniki continue to be especially attractive, with increases above 5%.
- A supply shortage creates potential, especially for active investors who can solve the “missing piece” in the market (renovations, refurbishment, properties awaiting value enhancement).
Important risks
- When supply is limited, the risk is this: if construction recovers, a price correction is possible.
- Construction in fact fell significantly in the first half of 2025, so if the downward trend ends, a slowdown in increases may be seen.
- The investor must verify: high renovation costs, local regulations (planning, permits), an understanding of specific areas, not just “Greece” as a whole.
Romania
Colliers: the Romanian real estate market is entering a cooling period
A report by the consulting firm Colliers published recently indicates that consumer confidence in Romania has fallen to one of its lowest levels in the last 15 years. After several years of record demand, Romania's housing sector entered 2025 in a cooling phase, as buyers became more cautious.
Consumer sentiment experienced its sharpest half-year decline since the financial crisis of 2009-2010, excluding the short-lived pandemic shock, Colliers noted. However, this decline is expected to be deeper and longer as the labor market weakens, with political instability and fiscal changes harming household purchasing power.
The government's decision to raise VAT to 21% from August 1 triggered a temporary wave of transactions, making July one of the busiest months in years. But Colliers analysts warned that the effect will be short-lived, as higher taxes, energy costs and fuel tariffs, combined with consistently high interest rates, are expected to restrain activity in the last months of 2025.
In the first eight months of the year, almost 106,000 housing units were sold across the country, almost unchanged from 2024, according to official data.
“Although construction indicators, building permits and buyer sentiment show significant declines, the market is not entering a recession similar to 2009-2010. Instead, we are witnessing a normalization after several exceptionally strong years in which demand consistently exceeded supply,” said Gabriel Blăniță, Managing Partner for Valuation and Advisory Services at Colliers Romania.
“In the long term, the fundamentals remain solid: large cities continue to contend with overcrowding and a housing deficit, while purchase intentions remain well above pre-pandemic levels. These developments indicate that the residential market is going through a period of adjustment, not a structural decline,” he added.
Prices in Romania's large cities continued to rise by about 5% in the first half of 2025, as a result of higher construction costs and demand for central properties. By contrast, suburban and metropolitan areas, where land is cheaper, experienced more moderate growth and more resilient supply.
Colliers noted in the report that the short-term outlook points to weaker demand and fewer transactions, as borrowing costs are high and fiscal pressures bite. However, it stressed that the long-term outlook remains positive, with Bucharest and other large urban centers still facing a housing shortage.
International bodies, including the International Monetary Fund and the World Bank, do not forecast an economic slowdown similar to the 2009-2010 crisis, the company added.
A “golden visa”?
According to the draft bill, the program - officially called the “residence through investment program” - would grant citizens of third countries (outside the European Union and the European Economic Area) a renewable five-year residence permit in return for a minimum investment of 400,000 euros in Romania - a “golden visa.”
The program would provide residence rights only, but would allow beneficiaries to apply for Romanian citizenship after five consecutive years of residence.
According to the proposal, suitable investment options include purchasing Romanian government bonds worth at least 400,000 euros with a maturity of five years or more; purchasing real estate worth at least 400,000 euros and held for at least five years; investments of at least 400,000 euros in funds authorized by the Financial Supervisory Authority (ASF); or purchasing shares in registered Romanian companies worth at least 400,000 euros.
The bill further provides that applicants will have to prove the lawful source of their funds, not appear on international sanctions lists, and not pose a security risk. Before permits are issued, mandatory checks will be carried out by the Romanian Intelligence Service (SRI), the Foreign Intelligence Service (SIE), the National Office for Prevention and Control of Money Laundering (ONPCSB) and other authorities.
Investors who meet the program's conditions will enjoy a renewable five-year residence permit, the right to include family members, and access to permanent residence and eventually citizenship after five years.
The draft does not require a minimum annual physical stay in Romania, but maintaining the qualifying investment will be mandatory throughout the residence period.
Storia: apartment prices in Bucharest rose by 70% over the last 6 years
Average apartment prices in Brașov and Sibiu doubled between September 2019 and September 2025, while apartment prices in Bucharest rose by 70%, according to an analysis by the real estate platform Storia. Among the country's large cities, the slowest growth rate was in Timișoara, where prices rose by 53%.
Average apartment prices rose over the last 6 years in all of Romania's large cities, but the increases were not uniform nationwide.
In total, over the last six years, marked by the COVID pandemic and high inflation, apartment prices in Brașov and Sibiu more than doubled, by over 103%, reaching 2,203 euros and 1,921 euros per sq.m., respectively, in September 2025.
As the most expensive city in Romania, Cluj-Napoca is also among the top 3 in growth percentages over the last 6 years, with an average rise of 93%, while in Oradea average prices rose by 88%, to 1,884 euros per sq.m. in September 2025.
Two smaller cities in Romania also recorded rises of over 80% in average prices (Craiova by 82% and Arad by 81%), while in Iași the increase was 73%.
In Bucharest, the average price rise was 70%, to 2,017 euros per sq.m. in September 2025. The only city among those analyzed with a lower rise than the capital is Timișoara. In the city in western Romania, the rise was 53%, to 1,891 euros per sq.m.
Cyprus
The real estate market is reaching maturity - stable prices, high foreign demand and a supply shortage
In October 2025 a clear picture emerges from data published in the Cypriot press: the Cypriot real estate market is moving to a state of relative stability, with a moderate pace of price increases, significant foreign demand and growing tension in supply.
According to data from the Central Bank of Cyprus (CBC) and the Cyprus Statistical Service (Cystat), in the second quarter of 2025 the House Price Index (HPI) rose by 0.2% compared with the previous quarter and by about 1% compared with the previous year.
Growth is concentrated mainly in apartments but continues to be weaker in private houses: apartments recorded annual growth of about 5.3% in the second quarter, while the increase in private houses remained around 3.4%-3.6%.
The regional trends are especially notable:
- In the Limassol district there was an annual rise in apartment prices of about 6.8%, the highest rate in the central areas.
- In the Paphos district prices vary: a second-hand apartment has an average price of about €129,774, while for private houses in the district the average price stands at about €386,828, which makes Paphos one of the more expensive areas for investment.
At the same time, the articles point to growing foreign demand - in the first months of 2025 the data indicate an increase of about 15% in purchases by foreign buyers compared with 2024.
The rental market also carries significant signs: in July-August 2025 transactions in prime areas led to high payments; for example, in the Limassol district the monthly rent for a one-bedroom apartment stands at about €1,651, for a two-bedroom about €2,574, and for three bedrooms about €3,812.
In summary: Cyprus today presents a real estate market that is on a “line of stability.” Prices continue to rise, but at a relatively moderate pace compared with what was seen after the crisis and post-COVID, and foreign demand continues to be a central engine. At the same time, a supply shortage, high construction costs and higher requirements for buildings (energy efficiency, etc.) raise the level of complexity for investors.
From the writer's desk:
- 1. An opportunity with control and expansion: the pace of price increases is moderate (~1%-5% a year), but together with high foreign demand it allows quality investment potential, especially in prime areas such as Limassol and Paphos.
- 2. A strategic choice of area: Limassol continues to lead in terms of prices and market size, but areas such as Paphos and even Larnaca also have added value for those seeking a higher excess return and a less “familiar” path.
- 3. Investing with a medium-to-long-term perspective: since expectations of price rises are no longer what they were (the HPI rose only about 1% a year nationwide), it is advisable to think in terms of 3-5 years and move away from the model of buying for “quick appreciation.”
Where did the young US homebuyers go? Check the stock market
The article examines how high housing prices in the US, together with sharp rises in the stock market, are changing young people's considerations between buying a home and renting and investing the money. According to a JPMorgan Chase report, 37% of 25-year-olds held an investment account in 2024, compared with 6% in 2015, and according to the National Association of Realtors the homeownership rate among Gen Z stands at only 16%. In an illustrative calculation presented in the article, after ten years the financial outcome of renting and investing in the stock market is close to that of buying a home for 400 thousand dollars, partly because of the leverage provided by the mortgage. The article emphasizes that the result depends on assumptions and personal circumstances, including selling costs, taxation, liquidity needs and the length of time living in the same place.
Source: The Wall Street Journal, Carol Ryan, 25.10.2025
Accurate as of the issue date. Laws, tax rates and procedures change; check the current position before any decision.
Translated from the Hebrew original. עברית