Buying Property in Greece
Guide to Greece
Aegean Islands
The Aegean Islands are a group of islands in the Aegean Sea, with mainland Greece to the west and north and Turkey to the east. Each Island has a different history or culture because of the way they are spaced widely apart. These Islands are very picturesque and have plenty of history and ruins to explore.
Attica
Attica is home to Athens, the capital of Greece which is considered the most metropolitan area of Greece. In contrast to the modern cities, Attica also has some of the most unrivaled beauty with its many forests and mountains and not to mention the famous lake Marathon. Great history is connected to this region.
Central Greece
Central Greece was on of the first regions of Greece which formed the Greek state. This region of Greece has the highest population, due to its many cities and towns. Like much of Greece it is full of distinctive history. This region also enjoys an amazing mountainscape.
Crete
Crete is a mountainous island where the main income would be agriculture and tourism. The cultivation of the olive tree is very important in Crete and excellent virgin olive oil is produced here. To the north of Crete is the main tourist area whereas the south is more tranquil and isolated.
Epirus
The region of Epirus, with its unmatched natural beauty and distinct cultural identity, lies on the northwest corner of the Greek mainland. It extends from the peaks of the ever snow-capped Pindus mountain range to the shores of the sapphire Ionian Sea.
Ionian Islands
The Ionian Islands are a group of 7 islands and can be found off the west coast of Greece. These islands all have stunning white beaches and crystal clear seas. Inland can be found charming traditional villages and olive groves. One of the most well known of the islands, Ithaki, was the home of Odysseus.
Macedonia
Macedonia is the second largest prefecture in Greece and its capital, Thessaloniki is the second largest city in Greece. Macedonia has beautiful remote beaches and stunning nature including the famous Mount Olympus.
Peloponnese
The Peloponnese region is a large peninsula in southern Greece. This region is the home of traditional Greek dancing and each area within the region has its own style or dance. Pelpoponnese has many citrus groves and untouched beaches giving the region. Such places as Sparta and Olympia are in Peloponnese.
Thessaly
Thessaly is considered as northern Greece. Its geography consists of a ring of mountains surrounding a central plain. There you can find quaint traditional villages and un-spoilt woods and ssplendid blue waters at beautiful beaches.
Thrace
Thrace is a region in northeast Greece. It is bordered by Bulgaria and Turkey giving it a hugely unique history and culture. Although this is a region of peace and beauty, many attractive modern cities can be found. This however does not distract from the amazingly diverse landscape of mountains, rivers and valleys.
Practical Information for Buying Property in Greece
Top 10 Tips
1. Property prices are much cheaper than in Western Mediterranean countries but they are starting to grow.
2. There are no barriers to Irish people buying in Greece.
3. A public notary is responsible for completing the sale.
4. You will initially have to put up a deposit of 5 to 10%.
5. Check that the property conforms to the description set out in the contract.
6. There is a complicated purchase tax (stamp duty) payable on all properties.
7. There are tax incentives for building stone or traditional properties.
8. Total expenses will be around 12% of the purchase price.
9. As a property owner, you are likely to be required to make tax returns, especially if you rent out the property.
10.You are likely to need the services of a Greek lawyer that speaks English.
The Greek Property Market
Before buying in Greece, determine your budget and if you are obtaining a mortgage from an Irish financial institution, make yourself aware of the sum available to you and any terms and conditions applying.
Because of its rich history and Mediterranean location, Greece has long been popular as a holiday destination but it has only recently seen outsiders buying property either as holiday homes or permanent residences (most restrictions on foreign purchase were only lifted in 1990). It has not been (over) developed to the same extent as other Mediterranean countries and available properties can often be difficult to find, especially close to good facilities. That said a significant building boom in recent years saw as many as 136,000 new residential units built in the country in 2006. Tax changes are encouraging developers but there are no signs that the surge in availability of properties is impacting on investment returns on rental properties. Construction costs in Greece are significantly lower than Ireland and you may chose to buy land and build on it.
Crete in particular, but all the Greek islands remain popular and prices will tend to be higher here than on the mainland. Depending on location, the average price for a 1-bedroom apartment averages from 60,000 150,000, a 2-bedroom apartment or townhouse ranges from 90,000 300,000, a village home or older, restored home will vary between 50,000 300,000, and you will find the most deluxe properties from 350,000 1,000,000.
There is strong evidence that a significant number of Greeks are investing in the cheaper, neighbouring Bulgarian market.
How to Find a Property Agent
There are some agents in Ireland who assist in buying Greek (and especially Cretian) property and occasionally advertise on the web and in magazines and supplements in Ireland. It makes sense to contact such agents before you travel to an area to look at property. Most Irish buyers tend to buy as part of a new development scheme and the Irish based agent will usually advise.
You will need to decide on the type of property for which you are looking. Is it a holiday home to be used a few weeks in the year, a more permanent residence or a rental investment? A holiday home ideally will require little maintenance.
Make sure that you make appointments with agents in Greece in advance. Give the estate agent a clear understanding of what you seek in a property. Be prepared for the types of property you are viewing i.e. wear appropriate clothing. Take a good local map and have a list of questions prepared.
The Legal Issues
There are no barriers on foreign nationals buying in Greece save where the land is close to a military base and in such circumstances; permission from the military is required.
Before buying, carry out a full examination of the location and price of the property.
Most important is to have the house inspected carefully, if not by oneself, then by a knowledgeable person in the area. This can be a broker or someone with relevant expertise. Any renovations or repairs of damages need to be checked. The roof should be examined by an expert or a good eye before buying. It may be advisable to use the services of a civil engineer or topographer to ensure land boundaries conform to the description of the land.
You should hire a Greek lawyer with good English. He or she will arrange for you to visit a Public Notary where you will pay approximately 60 and complete the documents required to give the lawyer Power Of Attorney to represent you in this purchase.
He or she will then be able to open a local bank account for you (in joint names, if required) to allow you to transfer money from your home country to Greece to finance your purchase. Your lawyer will then be able to forward to the builder or seller the stage payments when requested to do so.
Your lawyer, once given Power of Attorney, will obtain your local tax number for you. This number is required by law to enable you to purchase property in Greece and is essential for planning permission, connection to utilities, opening a Bank account and for owning a car, so make careful note of it as you will be asked for it when making any major purchase.
The purchase process in Greece is quite simple. When you have agreed a deal with the seller, a contract is drawn up. You should ensure that this is clearly translated and that you fully understand the terms. A deposit of 5 to 10% is normally required. The lawyer should ensure that the seller has the right to sell and that any outstanding debts on the property have been paid (else you could become liable for them).
The formal purchase is conducted in the office of the Public Notary, who is a state official. Both buyer and seller will be represented. If you intend to be there, you could ask for a Notary who also speaks English or your lawyer can translate. The Notary will read out the entire contract in Greek and oversee any last minute changes. He or she will also collect relevant taxes and legal fees. You should ensure that the Notary has no connection with the seller. Only purchase deeds approved and witnessed by the Notary can be registered at the land registry. The Notary is a neutral party in the transaction. Their duties are to ensure that the documentation is complete, that the documents comply with the strict rules that are applicable to the transaction and that the sale contract is properly drawn up so as to be acceptable to the Land Registry for registration of title. Once the Notary has done this, you become the legal owner of the property.
In many parts of Greece, it is tradition that all parties to the sale go for a drink afterwards!
Insurance
From the signing of the final contract the buyer is responsible for the insurance of all the buildings on the property.
Taxes, Fees and Charges
The total expenses are usually around 12% of the purchase price of the property; this covers your lawyers fees and purchase taxes, which in Greece are a one-off payment. Any variation is dependent on the Tax Office assessment of the property for purchase tax purposes (normally substantially less than the purchase price). These expenses are in addition to the property price.
The Tax Assessed Value (like Stamp Duty) is the estimated monetary value of a property according to Greek tax authorities. As a general rule, a property's tax value is significantly lower than its purchase price. To the outsider, this can be very confusing!
For values on property determined up to 15000 in places where there is a fire station a tax of 9% is raised and where no fire station is present only 7%. For values over the sum of 15000 in places where a fire station exists, 11% tax is applied and where no fire station is present only 9% tax is applied. Once the tax has been calculated a further municipal tax of 3% of the tax that is actually levied is applied. Thus if the Property Transfer Tax is 1000 a further 30 is payable.
The law requires that where the purchase price is greater than the Objective Tax Value, the greater value must be declared and a tax levied on that greater value. However, it is common practice for people simply to declare the Objective Tax Value and for the buyer to save themselves a substantial amount of money in transfer tax. The purchaser of property is obliged to file a declaration of transfer tax and to pay the tax that is due in advance. This declaration is filed in conjunction with the seller and must be signed by both parties. This tax payment is normally made on the day of contract signing.
Your lawyer or tax adviser should assist you in this area!
Greek law requires tax returns by property owners annually under the following circumstances
- You have a gross annual rental income of 600 or more
- you bought or built property in Greece during the previous tax year
- If you inherited, or were given as a gift, property assets
- If your main residence has an area of 200m2 or more
- If you own properties, other than your main residence, which have a total surface of 150 m2 or more
People owning a property in Greece but residing abroad must have a local representative. This could be a nominated accountant. The responsibility of the tax return, however, remains with the owner. Any accompanying papers that are in a language other than Greek must be accompanied by a certified translation. Submitted expenses must be accompanied by original receipts / invoices.
You should consult your tax advisor on these matters.
Planning Permission
Check with the local authority where you plan to build or renovate.
In the local town hall, you will find the village or plans boundary of the village or town where you are thinking of purchasing a parcel of land. The regulations are that if the land is appropriately zoned within the village plan, then you are likely to be permitted to build a property. If the land area is outside of the town plan and if no natural, archaeology or forestry restrictions apply, then permission can be granted to construct a building depending on various factors, including the road frontage of the property.
Building a stone house gives the owner certain tax breaks under an initiative by the government to encourage more traditional buildings. When buying seafront land, a topographical drawing of the seafront needs to be made by topographers. This will determine how near to the seafront it is possible to build. This drawing needs to be cleared and signed off by many government departments. There can sometimes be a wait of several months.
If renovating an old property, ensure that the property was not illegally built before you purchase it!