Rising housing costs put upward pressure on Greece’s CPI

Greece’s annual inflation rate rose to 2.7% in July 2024 from 2.3% in the previous month, according to figures released by the Hellenic Statistics Authority (ELSTAT) on the consumer price index (CPI). It was the highest level since April.

This was largely due to an increase of 2.4% in the group Food and non-alcoholic beverages, 2.4% in the group Housing (due to the increase, mainly, in the prices of: rentals for dwellings, services for the repair and maintenance of the dwelling, natural gas, heating oil), 3.5% in the group Transport. Moreover, costs declined at a slower pace for household equipment (-0.2% vs -0.4%) and communication (-0.3% vs -0.7%).

According to Eurostat’s flash estimate, annual inflation in Greece rose to 3% in July from 2.5% in June. Eurozone annual inflation unexpectedly edged up to 2.6% from 2.5% in June, compared to forecasts it would slow to 2.4%. Eurozone’s inflation readings are crucial ahead of the European Central Bank’s decision on interest rates on September 12. The ECB left rates unchanged in its July 18 meeting.

The fresh data highlight Greece’s persistent struggle with inflation, notably exceeding the EU average in several categories. For actual rentals for housing, Greek inflation rates spiked significantly above the EU norm, reflecting the rising cost pressures.

Rents are climbing throughout the country, with continued increases in the second quarter of 2024 compared to the same period in 2023. The average asking price in Piraeus stands at 10 euros per square meter, up 14.3% on an annual basis, according to data from Spitogatos listings network. The port city leads nationwide sales price increases (23.6%) for the period of April to June 2024.

The CPI refers to the whole Country and covers the resident households of the territory excluding collective households (hospitals, homes for the elderly, boarding houses, prisons, etc.) and non-resident households (tourists) in the Country.