You mean, prices are continuing to fall and you would be right.
With so many rental properties to choose from, it is becoming a renters market, not a landlords/ladies market but there comes a point when the property is no longer worth letting out due to maintenance costs/cleaning/repairing after rental etc.
For a 4 bed, furnished property (regardless of the time of year as with a long term rental this has no bearing) you should expect to be able to achieve a rental based on 550-650 pcm exclusive of bills - much higher than this and you're likely to find many other alternatives available if your friends have a good look around.
As for the landlord/lady - expect grief no matter who you rent to if it's your brand new home as things WILL get damaged, broken and messed about no matter what your tenants may say - so expect some discomfort from tenants staying in your brand new home if you rent it out, i,e,. don't expect your home to remain shining brand new once tenants have used it.
I mean no offense here but most people will not look after the property in the way that you would yourself - especially during the summer months when they are likely to feel more like they are 'on holiday' rather than living there.
The shorter the rental term the higher the risk to the property - so build this in and most definitely ask for a deposit of at least the first month's rent and make sure even that you get all the funds upfront, including the deposit as you would be surprised to find how many people would try to get away without payment of bills ....
Not that I am saying the friends of the person who is asking are dishonest - but people are very surprised at the high cost of living in Crete and therefore may try to cut corners.
Also ask for names, passport numbers, identification, utility bills. First time renting a property to tenants means you need to be stricter than usual and not to accept everything that you are told as people have a tendency to take advantage.
It's a bit of a cruel situation on short term lets and really no offense is meant towards the potential tenants - only trying to urge the need for caution by the landlord/ladies on who they let to, especially if they haven't let a property before and don't know the pitfalls.
Also, trying to gauge how much a tenant has to pay in utility bills for a shorter let is difficult due to bi-monthly bills payments and the fact that, if you take your own reading, it is unlikely the office (electricity/water etc.) will be interested in adjusting their records - so know roughly how much you use at the property and learn to read Greek bills before passing on the bills to the tenants to ensure the bills paid by them are correct and you don't lose out and they don't end up paying too much.
As for rental prices, word of mouth usually gets a better deal and there are 3 bed almost brand new furnished properties available for long term lets at 200/300 Euros pm - but not usually those that are advertised as being next to the coast with the luxury of swimming pools etc.
Some of these other properties are out of the way, much better than being in the tourist area and in a far cheaper area for restaurants etc. So if the property is in a popular area, the tenants need to be aware that the prices in those areas (supermarkets/restaurants etc.,) are likely to be much higher than those in the surrounding smaller villages.
What surprises me most of all is that development on the island is allowed to continue at the rate that it has been and it is almost spoiling a beautiful place in which to live with all these new houses springing up everywhere - it must by now be getting near to bursting with the lack of resources available to the people who live there (e.g., falling water levels, more cars on the National Road in the summer).
I suppose it's the Greek Government continuing to issue licenses to build so that they can continue to receive their much needed finances from IKA.
There must now be more houses on Crete and more rental properties than there is a demand for housing, which helps to keep prices lower than has been expected in the past.