A legend swirls around the dilapidated mansion on Smolenski Street in Athens that the previous owner’s ghost scares off prospective buyers by moaning, “The house is mine.” The Greek government isn’t spooked. It sold the two-story house and tower, replete with palm trees in the overgrown gardens, for €434,000 ($580,000) on Sept. 17 in an EBay (EBAY)-style Internet auction. While he doubts the house is haunted, Andreas Taprantzis, executive director for real estate at the Hellenic Republic Asset Development Fund (HRADF), says the building was “haunting the Greek budget,” generating “zero income, not even taxes.”
Most assets to be auctioned online have come into the Greek state’s possession through foreclosures, bequests, or donations, or after their owners died without heirs. “Many people end up with no heirs, and eventually the state inherits the property,” Taprantzis says. “The state is family for all citizens, including the ones with no heirs but with a fortune.”
Real estate, including more than 70,000 properties that range from a luxury beach resort on the Athenian coast to a disused car repair shop, accounts for half of the €50 billion the government originally pledged to raise from selling assets in return for a total of €240 billion in rescue funds. Hobbled by red tape, a dearth of demand, and political resistance, Greek state asset sales haven’t brought in the revenue demanded by the European Commission, European Central Bank, and International Monetary Fund—the so-called troika of lenders that bailed out the country.