The Greek islands have the azure skies and crystal clear sea essentials that attract millions of tourists every year, yet their popularity with tourists is not quite matched with overseas property investors.

However, the factors behind this issue are being addressed. A complex web of bureaucracy, old fashioned laws, lack of financing and high taxes combined to put some investors off Greek property in the past. However, the current Greek government is keen to attract overseas buyers to its shores. A change of government in 2004 saw the former socialist government, which had stifled an emerging property market in Crete, replaced with a forward-thinking government that is encouraging investment from overseas.

In its report on the Greek travel and tourism economy, the World Travel and Tourism Council (WTTC) said Greece's tourism market is doing well in terms of the amount of market share it commands – with a 10 per cent share of total Mediterranean tourism – and also predict future growth of around 3.7 per cent in tourist-generated revenue.

So, why does the investment landscape now look especially good in Crete?
Firstly, the island has three airports in all – Sitia, Heraklion and Chania – so there is the all-important ease of access for investors. "Crete is the largest Greek Island in the Mediterranean and enjoys a healthy climate," says George Tsatsakis of Orfeas Constructions. "In addition to the easily accessible airports are ferries and fast boats that arrive frequently from Athens. When you combine this with the hospitality of the people – who make you feel welcome from your first visit – the island is easy to get to
but not so easy to leave!"

So, where are the island's investment hotspots?
"The western side of Crete is drenched in history and mythology with Blue Flag beaches, lush plains and a more traditional way of life that attracts many investors," says Tsatsakis. "Chania, especially, is becoming a sought after area with investors." So, what other factors may appeal to investors. "Mortgages interest rates are as low as 4.9 per cent," Melissa says. "Loans for foreign buyers have also recently become easier to secure for Cretan property, especially if one can prove they are a reguar tax payer in their country."

One product from Greek bank Piraeus – available to those with minimum income levels of £75,000 who require financing for Greek property valued over 500,000 euros – takes  between 50 and 75 per cent of projected market rental income into account towards mortgage repayments. Buyers using this product have the advantage of an interest only period of up to ten years. "The British market seems to like small projects, such as four or five masionettes with a shared pool," Tsatsakis says. "These start from around 169,600 euros and are a great investment as owners can easily obtain a licence allowing them to rent to holidaymakers."

Related articles:
Greek property and tourism markets reviewed
Ever thought about a property in Crete?

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Article published 23 April 2008