Banks and Servicers Plan to Sell Non-Regularized Properties

The possibility of proceeding with transfers, even if urban planning and legal regularizations are incomplete, is expected to be given to management companies and banks in order to bring approximately 25,000 properties they hold on their balance sheets to the market, significantly boosting property supply. Additionally, banks are expected to be allowed to provide loans to interested buyers purchasing foreclosed homes, using the property itself as collateral. According to reports, these two institutional interventions requested by servicers and banks aim to address the issues hindering the availability of properties in the market. This comes at a time when there is an urgent need to immediately increase housing supply to meet the high demand under the ‘My Home 2’ program, where banks approve loans but cannot disburse them if applicants haven’t found a property. In total, banks and servicers manage around 25,000 properties. Yesterday, Prime Minister Kyriakos Mitsotakis emphasized the supply issue regarding housing programs, stating that the government will incentivize and use appropriate financial tools to unlock closed properties. Servicers and banks have highlighted significant delays in land registries and urban planning processes, causing property transfers to take from 8 months to 4 years. They estimate that about 10,000 properties could be immediately available for sale if pending issues are resolved by the buyer. Regarding foreclosures, which account for 75% of properties ending up with banks, faster timelines in each stage of foreclosure and bank-financed third-party purchases are requested.