Like a spoiled child on a spending spree with no parental guidance, Greece is forced to sell some of the most beautiful real estate in the world on the cheap…
Wealthy foreign investors are expected to buy up Greek islands in coming months as Monday’s bailout will likely force hard-hit rich Greek moguls to dump their piece of paradise. This “fire sale” of private Greek islands to “bargain hunters” is expected to take place over the next few years, according to property agent Knight Frank.
Greece imposed the first-ever real estate tax last year to raise cash for creditors, making property ownership prohibitively expensive, according to Knight Frank’s Island Report.
Foreign investors are taking advantage of the falling property prices, which have plunged by 30 percent over the last five years thanks to Greece’s debt crisis. Here are some island hunters who hoped to profit from Greece’s woes:
Russian billionaire’s daughter buys Skorpios for ~$150 million
Ekaterina Rybolovleva, the daughter of Russian billionaire and former owner of Russia’s largest potassium fertilizer producer Dmitry Rybolovlev, reportedly bought the island for $150 million in 2013. Skorpios was owned since 1962 by shipping tycoon Aristotle Onassis and served as the location of his wedding to Jackie Kennedy. His daughter eventually sold it to Rybolovleva, although it was reported that Madonna and Bill Gates had expressed interest in scooping it up.
Qatari Emir buys six Greek islands for $9.4 million
If you can’t afford Skorpios, buy a half a dozen other islands. That’s what Hamad bin Khalifa Al Thani did in 2013 when Rybolovleva reportedly wouldn’t lower her asking price for Skorpios. Al Thani planned to use the islands exclusively for his 24 children and three wives, The Guardian reported.
Brangelina looking at $4.7 million island Gaia
Brad Pitt and Angelina Jolie wanted their six children to run around in peace without the paparazzi, news outlets reported in June. The 43-acre island secured planning permission for six villas back in June, The Washington Post reported.
Chinese construction magnate buys island for $770,000
In a bidding war of 48 Chinese investors in March, a Greek island up for auction on Taobao (China’s eBay) was nabbed by a construction tycoon from China’s Yunnan province, International Business Times reported. The same man also reportedly bought a Canadian island for 1.7 million yuan, or $273,985.
Dozens of other Greek islands are listed on Private Islands Online, with more expected to crop up as once-wealthy owners are forced to liquidate their assets. A 54-acre Stroggilo Island, with “a perfect 110 meters beach that can easily transform to a heaven on earth place for vacations,” is available for the paltry sum of $4.5 million.
Greece could exist outside the euro
Admittedly, it would mean yet more hardship and austerity, but maybe one day they would be able to use the freedom having their own currency would give them to rebuild a more competitive economy. It worked for Britain. That said, their euro currency debt would immediately rise in real-terms value against any New Drachma, and would make the debt burden even worse. Default would be inevitable; as it may be anyway.
Even if they got their debts entirely written off, it would all start over again before long
This is the fundamental point. Greece was living beyond her means after the euro was introduced; taking advantage of the cheap interest rates on the euro bestowed by its status as a strong currency backed by Germany. They had a great big party, buying all those nice German cars and the consumer digital wonders of the noughties; and now the hangover is still taking time to work through. There is no reason to believe that such reforms as there have been in Greece will be enough to enable Greeks to live comfortably within their means. The debts will pile up and the crisis will return. Syriza has no policies to make Greece competitive with say the Slovaks or Poles, let alone Korea and China. Via: The Independent UK