Greek Election Result Is A Trojan Horse For Property Investors

When I was a youngster, I was always fascinated with the legend of Troy, the story featuring the large wooden horse that helped the Greeks capture the city of Troy. The Greek elections have once again brought this story to mind – only now I’m thinking, will the result be a Trojan horse for property investors?

The problem is that all those European leaders breathing a sigh of relief at the result of the Greek elections – which saw the New Democracy Party edge out the ‘anti-bailout’ Syriza Party – may soon be faced with further instability in Greece.

For property investors looking at the potential of investing in property within EU countries, the future remains just as uncertain as it was before the elections.

All that sovereign debt hidden inside this modern day European Trojan horse still poses a threat to the prospects of recovery and it remains a real one.

This Trojan horse is not just threatening Greece, it also has Spain, Italy and other countries in Europe feeling anxious.

On the surface the Greek election appears to be good news, however it will only be good news if a government is formed and the austerity measures are accepted in Greece.

This is far from guaranteed and as we have seen across Europe, people are rebelling against even mild austerity measures. The Greeks will be no different in the face of much larger cuts to their standard of living.

As a property investor, one of the most important things we can look at is the strength of an economy. Growing economies are always good for property markets, while shrinking economies are bad.

Just as most property investors in their right minds wouldn’t invest in Greece right now, perhaps the same should apply to other rocky countries like Spain or Italy. If Greece leaves the Euro, there is a real possibility of these two countries Joining them.

This would mean a lot of uncertainty and disaster for those who invest in property in those countries who have no option but to return to their old currency. Tens of thousands could be wiped off the value of property at a stroke leaving investors high and dry.

This is why in my humble opinion investors should be looking at opportunities to invest in Turkey property or perhaps Brazil or U.S property where the outlook is far more stable.

These countries are seeing growth in their economies even as Europe has struggled to get its house in order. Property in Istanbul or U.S. states like Florida and Atlanta look a far better prospect because we don’t need to worry about people paying the rent or who we can sell to when it comes to exit time.

We can also relax in the knowledge that property prices will rise as property for tenants in Atlanta remain in short supply. This will keep rents high too meaning good positive cash flow from the outset.

Now if I was a betting man looking at the next five years ahead I would be putting my money on Brazil the U.S and Turkey right now rather backing the Trojan horse in Europe.

Will you be keeping a close eye on the Greek crisis before investing? Please leave your comments below:

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Categories: News / Property Invest


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