Stournaras: Housing Costs Are Shrinking Greece’s Next Generation

Greece's central bank governor Yannis Stournaras said Tuesday that the country's housing affordability crisis is directly worsening its demographic collapse, warning that young Greeks are delaying or abandoning plans to start families because they simply cannot afford a place to live.

Speaking at the Croatian Central Bank Conference in Dubrovnik, Stournaras said Greece's housing cost burden on households ranks among the highest in the eurozone. He described housing insecurity as an increasingly powerful factor shaping long-term demographic trends, noting that limited access to affordable housing is delaying the formation of new households, especially among younger generations.

"Young Greeks are delaying or abandoning plans to start families because they simply cannot afford a place to live" — Stournaras

Many young adults are staying in their parents' homes longer than they want to, while others are postponing or reconsidering the decision to have children altogether, Stournaras said. He added that population shrinkage and aging reduce the size of the workforce, weigh on long-term growth potential, and put mounting pressure on public finances.

The Bank of Greece data shows that property purchases are funded primarily through personal savings rather than mortgages, which Stournaras said means housing demand is relatively insensitive to interest rate changes. A significant share of buyers are using accumulated wealth to purchase property outright instead of taking out bank loans.

Demand is being driven not just by domestic factors like rising disposable incomes and government housing support measures, but also by foreign investment, increased tourist flows into urban centers, and the perception of real estate as a safe asset, he said.

Stournaras acknowledged that the government has introduced subsidized mortgage programs and social housing initiatives, but cautioned that these policies take time to produce results and that affordability pressures are likely to continue in the short term.