The economic crisis in Greece

For the Greeks, economics is a popular topic of discussion. Firstly because the Greeks are Greek, so discussing is what they do. But secondly, the Greeks are very familiar with the effects of an economic crisis. When the global financial crisis hit all of us, Greece was hit harder by their own economic downfall. The Greek economic crisis of 2009 is still something the country is recovering from today.

What caused the crisis?

One of the main causes of the crisis was the high level of government spending and a large budget deficit. Taxes and other revenue sources did not cover the country’s costs, which led to a large budget deficit financed by borrowing. Although this had been going on for years, the global financial crisis revealed this problem. As borrowing money became more difficult and expensive. 

As the crisis began to unfold, it became clear that Greece was not only unable to repay. It turned out that Greece had been lying about the severity of the country’s dept. It was revealed that the Greek government had been underreporting its budget deficit. While the Greeks stated a deficit of only 3,7 percent, it turned out to be 15,6 percent! 

This is when the crisis really started. There was a loss of confidence in the country’s ability to repay its debts, leading to an even sharper increase in borrowing costs. Greece was broke.

The impact of the crisis

The impact of the crisis on the Greek economy was severe. GDP plunged by over 25%, and unemployment reached record levels. Many businesses went bankrupt, and there was a sharp decline in consumer spending. The crisis also led to significant social and political upheaval in the country, with widespread protests and strikes.

The Greek government

The Greek government responded to the crisis by implementing austerity measures. These are strict economic guidelines enforced by a government to lower government spending and decrease public debt. As a result, Greek taxes were raised, and structural reforms were implemented. 

The goal was to reduce the budget deficit and restore confidence in the country’s ability to repay its debts. However, what happened was a further decline in the economy and increased social unrest.

Social unrest

During the crisis, the Greek people felt that they were being unfairly punished for the mistakes of their leaders. In their opinion, the wealthy and powerful were not being held accountable for the crisis. The burden was being placed on the shoulders of the general population. 

Due to the austerity measures, many Greeks became unable to afford basic necessities. The unemployment rate rose, salaries and pensions were reduced, and taxes increased. Many Greeks lost their homes and businesses, and even healthcare and education were affected. In their opinion, due to the mistakes of their government. The Greeks were angry. There were protests in the country, and people tried to avoid paying taxes in order to survive.

European Union

The economic crisis in Greece also had a significant impact on the Eurozone as a whole. Greece was the first country to experience a sovereign debt crisis. This led to concerns about the stability of the Eurozone, and the ability of other European countries to repay their debts. 

Tourism

Greece’s GDP has always been heavily dependent on tourism. However, during the first years of the economic crisis, there was a decline in the number of tourists visiting the country. Greece was portrayed in the news as a country full of protests, homeless people, and beggars. Other countries even advised against traveling to Greece due to safety reasons. Besides, many hotels and restaurants had to close due to bankruptcy. 

Fortunately for Greece, this image slowly disappeared, and tourists returned, increasing the country’s economy. Helping Greece to get out of depth.

Greece today

During the past 10 years, the Greek economy has been recovering, and the country’s GDP has been growing. There are fewer homeless people on the streets, and the unemployment rate has decreased. Greece even managed to repay its depth with the International Monetary Fund (IMF) two years ahead of schedule.

However, the country still has a large public debt, and the government continues trying to implement measures to improve the economy. The economic crisis still has an impact on a life in Greece, but things are getting better each year.

The many abandoned and unfinished buildings in Greece

During your stay in Greece, you might be surprised by the many empty or half-finished buildings you come across. You find them in cities, towns, villages, and even remote areas. They are everywhere, and as an architect, I wanted to understand the reason behind them. After talking with many Greek citizens and homeowners I created a list of the most common reasons for abandoned and unfinished buildings in Greece.

Economic crisis

Let’s start with the simplest reason for the amount of abandoned and unfinished structures throughout Greece. The economic crisis in 2008. The downfall in economics hit Greece hard after the start of an economic burst just 8 years before. People had loans to either build their house or own one when all of a sudden they could not afford their mortgage anymore.

These people lost their houses or had to leave their ongoing construction projects and since the crisis hit the whole country, the government could not sell the empty houses to anyone else, leaving many abandoned and unfinished buildings in Greece.

Building is a life-long project

Ownership of property is very important in Greek culture. It is the symbol of wealth for a family. But where people from other countries precisely plan and budget their future house before taking on the construction of it, the Greeks have a slightly different approach.

Greeks will start building their house, even if they know they do not have enough funds to complete it. They are super optimistic, or naive maybe, hoping that money will show up at one point. But it can take up to a whole generation before even completing the first floor.

They basically start building as soon as they have their land. And stop when money is finished. There can be 10 years between building the walls and putting in the windows. And of course, the economic crisis only made this worse. Siga, Siga.

Claiming the land as yours

In Greece, ownership of land is something not well registered. In fact, only since 2019, you are obliged to register your property or plot with the National Cadastre of Greece and even today this system is not fully functioning. Records about ownership get lost, and therefore you basically have to physically claim your land as yours.

When a Greek finds a plot, perfect for his or her future house. Buying it and then leaving it empty for years could result in losing the land as well as the money it cost to buy. To avoid this, the Greeks build frames for future houses. This structure can be owned while you barely have to pay taxes.

Building rules change continuously

Another benefit of putting up the structure of the house before actually building it is the fact that you’ll later be able to build the size of house you wanted in the first place.

Building regulations change quickly in Greece, as a counter-act on basically everything described before. When you buy land in Greece today, wanting to build a mansion in thirty years, there is a chance you might not be able to build more than a shed. However, if the structure already exists and has the size of a mansion, your volume is safe. No matter what rules will come in the future, they will not be able to decrease the size of your property.

But the structure is not only put up to avoid rules that will come in the future. The Greeks even try to avoid the rules that are existing today. Only in Greece, it is possible to buy land on which you can not build a house, and legally build a house afterward.

What happens, in this case, is that first the structure of the house is built. Then, the Greeks go to the municipality, saying that since they already built this structure, it should be legal to build a house. Often, the municipality decides to make it legal to build and hands out a building permit. But when they don’t, you have an extra abandoned unfinished structure. And of course, the Greeks blame the government for this.

Read more about illegal buildings in Greece here, where a political engineer advertises to make money by legalizing illegal buildings or building parts. According to him, ” all the buildings that were built in the previous years – and I mean all!!- have some type of arbitrary building.”

Family inheritance

The final reason for the number of abandoned buildings in Greece is heritage. As I said before, homeownership is important in Greek culture. And because of this, a house is not really a tradable thing for the Greeks. It is a family legacy.

This made sense until the second world war, when most of the Greeks lived in the villages, in their family legacies. But things started changing after the 50’s. When the economy started growing, the Greeks started moving toward the cities, driven by work and money. The generation after moved even further away, this generation spread out over Europe and the US in search of a better life. However, they still own their family houses in the villages.

The Greeks today don’t use the family house anymore, but still recognize the value this house has to the family. They don’t want to sell, they want to own. To make things more complicated, many of the houses are not owned by one person but instead by the whole family.

Selling the family house means agreeing with the whole Greek family. And trust me, there will always be someone who will not agree. Even if the whole family knows they will not live in the house, they will not find an agreement on selling it. Maybe they will use it to celebrate Easter together once a year, just to have a reason to keep it.

Myths, culture, and future

Tax evasion

There are many stories about the Greeks not finishing their houses to avoid taxes. However, nowadays this is more than a myth than it is reality. Years ago, there was a rule in Greece that when you would not finish your house, you would pay fewer taxes. As a result, many Greeks just left a little part of their house unfinished, to avoid the normal tax rate. However, this rule does not exist anymore and has not for a long time. The only way to avoid a higher tax is for buildings that are unfinished, uninhabited, never been inhabited, and are not connected to electricity.

Perception & culture

As a Dutch architect who knows Greece, I believe it is not just the structures that are actually unfinished that I perceive as such. Yes, there are quite a few abandoned and unfinished buildings in Greece. However I believe that cultural differences play a big part here as well. It happened often to me that I thought a building was either abandoned or unfinished while it turned out to be a family home.

Greece doesn’t know a municipal beauty committee, nor do the Greeks actually follow the rules of building. Making the cities look a bit like a mess. Besides, the Greeks are very practical. They want to be able to easily add an extension or extra floor to their house, or they leave the ground floor completely open so they can park cars between the concrete columns. They care about function more than about design and this might cause some confusion.

Future

Walking through a Greek city today, you can see that the Greeks started doing something about the many abandoned buildings. Renovation starts to become popular, especially in the big cities. Hopefully soon, the number of abandoned and unfinished buildings in Greece will become something from the past.

Read more about buildings in Greece

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The old, the empty, and the ugly. The story behind architecture in modern Greek cities.

The Greeks are famous for their architecture and even invented this type of art. Look at the Parthenon, the Temple of Apollo, or the ancient theatre of Epidaurus. All great examples of architecture and now on the list of UNESCO world heritage sites. Also, on the Greek islands, architecture resembles art. The idyllic villages with narrow stone streets, surrounded by whitewashed walls and blue roofs that match the color of the sky. The Greeks knew what they were doing, but what happened with architecture in modern Greek cities?

A quick history of Greek Architecture

The Greeks invented the elements needed to turn a structure into art. The formulas they invented, as early as the sixth century B.C., have influenced the architecture of the past two millennia. All around the world. Greek temples and theaters have been the inspiration for many architects, and even The White House is inspired by Ancient Greek Architecture.

After Ancient Greece, architecture continued to evolve in the land that is now Greece. With influences from the Byzantines, the Venetians, and the Ottomans, many cities became a combination of beautiful churches, mosques, and castles. On the islands, the protection against plunderers created the idyllic white and blue villages. But unfortunately, history does not end there. After the Second World War, the country was in ruins. And when, years later, Greece was finally in an economic situation to rebuild. The Greeks seemed to have forgotten about architecture.

Rapid expansion after the war

In the 1950s, ’60s, and ’70s, the economy in Greece was booming. There were plenty of new jobs in the Greek cities, and the Greeks decided to leave their houses in the villages in search of a better life. 

Quickly, the cities got full, and there were still enough vacancies to be filled. Greek cities needed more houses, and they needed them fast. Whoever had enough money to invest in a piece of land built a new apartment building in the city. These investors were just random people without knowledge of construction and instead solely looking for an easy way to make a profit. 

Instead of letting architects design the housing for modern Greek cities, an enormous amount of apartment buildings were built and designed by engineers. Buildings are cheaper without an architect who prefers form over function. Besides, during this time, there was no municipal “beauty committee” to control the aesthetic part of the new-build areas in the cities. Everyone could do what they wanted, as long as a building did not exceed the maximum of six stories to make the city safe during possible earthquakes.

As a result, the cities got packed with uninspiring six-story high concrete apartment blocks, the polykatoikias.

The polykatoikias brought life to the Greek cities

Although the look of the concrete apartment blocks in the Greek cities is far from great, this housing type turned the Greek cities into the lively places they are today. 

Every apartment block had a mix of apartment types on the inside. Poor farmers who had just entered the city would live on the bottom floors, and richer people lived in the penthouses on top. There was no division between rich and poor neighborhoods, and everyone was allowed to start a business from their apartment. The result was an interesting mix of functions within each block, which made the cities pleasant and vibrant. 

Besides, every apartment building has a generous balcony on the side of the street. These balconies have two advantages. Firstly, they prevent the houses from overheating in the summer. The concrete slabs shadow the windows of the apartments and prevent the sun from directly entering the house. Secondly, the balconies turn each street into a lively place. You can hear family gatherings and neighbors chatting above the streets. Creating a more friendly environment.

The problem of ownership and aging

Before the expansion of the modern Greek cities, the land was owned by whoever inherited it. Often, these people did not have enough money to invest in an apartment building. Neither did the government have the funds to buy their land for the city. So in order to expand, investors took the land, and in return, the owners got a couple of apartments in the future polykatoikia.

As a result, each apartment block had many owners. In the first decades of their existence, this was not a problem. However, when the buildings started to age, maintenance became difficult. Today, one building can have over 70 owners! So who is responsible for which part of the building?

Time revealed that many buildings were constructed with profit in mind. Plumbing and insulation often fail, and paint crumbles off. However, none of the residents feels responsible for fixing the problems of the building. The Greeks don’t want to pay anything for their neighbor, so if 30 people own one block, and one of them does not have enough money to remove, for example, the graffiti on the entrance, no one will do it, and the graffiti remains. 

As a result, many people choose to leave a not-well-maintained apartment block. When a homeowner had money to afford renovation, but his neighbors did not, he would move to a place with people who shared his standards. Poor people stayed together in poorly maintained houses and could not afford the renovation. Some of the apartment blocks were even abandoned completely.

The old, the empty, and the ugly

In the ’90s Greece became a part of the European Union, and with this came money. The Greeks were again ready to invest in housing. As a Dutch, I would say great! Time to upgrade the concrete blocks that did not age well and make our cities great again. But unfortunately, this is not what the real Greeks wanted to do with their money.

Why invest money in someone else’s leftovers if you can build something that is your own? While the polykatoikias were falling apart, new concrete was added to the city by engineers. Until the crisis hit Greece in 2008.

After 2008, not only were many buildings left unfinished, many companies, as well as people, lost their houses. I stayed last February in a hotel in the city center of Thessaloniki. On the corner in front of the hotel I stayed in, there was one abandoned building, one unfinished structure, and one apartment building with only a few residents, ready to fall apart. The hotel itself, however, was a beautifully renovated building from the early 1900s.

It makes an interesting scenery, architecture in modern Greek cities! The combination of ancient architectural masterpieces with the complete lack of design in modern buildings. Every time I visit a Greek city, the architect in me imagines the potential of all the beautiful old empty buildings. As well as parks and skyscrapers, in the sites now occupied by the concrete, earthquake-proof engineer blocks. But will Greece ever make her cities beautiful again?

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This weekend I found myself at a Greek barbecue. Traditional Greek music, souvlakia on the grill, and surrounded by fifteen Greeks, all speaking their own language. The funny thing is that I was not even near Greece. The barbecue took place in a park in the center of Rotterdam. Real Greeks take some Greece everywhere they go.

Why there are so many Greeks outside Greece

Greeks love their culture and country. But many of them decided to leave Greece after the economic crisis that started in 2008. Unemployment was high while salaries hit a low. Many highly-educated young people decided to leave their country, in search of the ability to afford life. And so, Germany, the UK, and the Netherlands, amongst many other countries, became home to a young Greek community.

Greeks stick together

Although most Greeks found good jobs with a stable income in these countries, they entered a completely different culture. Being raised surrounded by family and friends, Western Europe should have felt both lonely and cold to them. Missing the chaos and warmth of their own culture, they stuck to the other Greeks.

The Greeks away from Greece are all part of at least one Greek family of very close friends. My boyfriend, for example, was living with no less than six other Greeks before we moved in together. A Greek colleague of mine lives with four and our Greek neighbor, who lives alone, is never at home, spending her time surrounded by other Greeks on their couch.

Cultural difference

There are little Greek communities everywhere. And surprisingly, I do totally understand them. We Dutch might seem open and friendly at first, but when it comes to close friendship, we still stick to our agenda’s and send you away when dinner is ready.

Meeting my parents for coffee means arranging a date about a month before, complete with the location of the coffee we’re going to drink. Then as soon as the coffee is finished, they will leave, moving on to the next item on their agenda.

And then there is the Greek way of going for coffee. It can happen whenever and wherever doing whatever. They do what they want when they want to do it, they don’t plan ahead, not even 5 minutes, definitely not when it comes to their personal lives. And I believe they are right to life this way.

Even after 10 years it is temporary

I guess a big part of why the Greeks stick to their own culture is the fact that many Greeks didn’t choose to leave their country. Or at least not permanently. The Greeks I know, came to the Netherlands believing to only stay for one or two years. Waiting for the Greek economy to recover they have spent over 10 years away from home. But they never wanted that, nor do they want it now.

Moving back home

Slowly I see more and more of our friends moving back to their hometowns in Greece. Choosing the warmth of their culture over the money they can make elsewhere and the safety that comes with it.

The continuous struggle the Greeks have between missing their culture and loved ones, and having the security of a Dutch job is painful to see. While on the other hand, them working for 12 hours a day for a salary they can not afford an apartment with might be even worse. I just really hope that a trend of Greeks moving back will help the economic situation of Greece, making it the beautiful country it once was.

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