Like most European countries, Greece was strongly affected by the 2007 economic crisis. Real estate prices then collapsed, losing more than 45% of their value in a few months. More than 10 years later, Greek real estate prices have not yet reached their pre-crisis level, except in highly tourist areas such as Athens, Santorini or Mykonos.
Seduced by its magnificent landscapes, its climate and in front of this attractive real estate market, many foreign investors have chosen to build or acquire their Getaway home by sea in Greece. If you also dream of owning a property in Greece here are some tips to start your buying process.
Property purchase procedures in Greece
Any foreigner can become a homeowner in Greece. The country does not apply any restrictions on purchase. On the contrary, nationals of non-EU countries can even benefit from the Golden Visa as long as the minimum amount of their real estate investment is €250,000. This five-year residence permit is renewable and extends to his family (parents and children). After 7 years of residence, it is possible to apply for a Greek passport.
It is strongly recommended to be accompanied by a specialised lawyer when buying a property in Greece. There is no land registry in Greece (except in a few cities including Athens), so it is necessary to have a lawyer’s assistance before signing any sales agreement. The latter will thus be able to check the property titles, the building permit, the length, the build-ability of the land… Similarly, it is advisable to call upon an accountant, a notary (often chosen by the seller) and even a surveyor who will ensure that all construction acts are in conformity with the law.
To be able to buy a home in Greece, you must obtain a non-resident tax registration number (AFM) and the access codes to the “TAXIS” system. This system makes it possible to fulfil its reporting obligations (including the payment of the housing tax). It is also advisable to open a bank account in Greece, which will facilitate the transaction and tax procedures related to the ownership of your property.
When signing the promise of sale, it is usual to pay a “deposit” and set a deadline for signing the sale agreement. However, you should be aware that the amount paid is not a legally binding guarantee of sale. To conclude the sale, the owner must provide a certain number of documents (tax certificate, energy performance certificate, etc.). The transfer of ownership is then done before a notary. The presence of an interpreter at the signing will be mandatory for people who do not speak Greek. Once the transaction is effective and with the help of his lawyer, the new owner must file the acquisition declaration within one month of purchase (E9 declaration).
Property costs in Greece
There are some costs to becoming a homeowner in Greece. Acquisition costs, which include taxes and notary fees, rarely exceed 5%. The real estate agency’s commission, paid by the buyer, generally amounts to 2% of the sale price of the property while the transfer costs are about 3%. Legal fees vary the most time between 1.5% and 5% of the value of the property.
Once you become a homeowner, you must pay some related taxes such as property taxes. The Property Tax is assessed according to the price of the property concerned. Thus, the rate is 0.10% for a property over €200,000; 0.15% for a property over €300,000; 0.25% for a property over €400,000, then 0.35% for a property over €500,000 and so on. It is then 1.10% for a property of 2 million euros. Beyond that, the property tax applied is 1.15%..
Rental investment, the things to know
Making a rental investment in Greece is a very interesting choice, especially if you choose to invest in tourist areas such as Cyclades (Santorini and Mykonos in particular), Crete, Rhodes or Porto Heli. The return on a rental investment in Greece usually varies between 4% and 6%.The Capital Athens is also a great choice It goes without saying that Athens is by far Greece’s most visited spot by tourists worldwide. Athens is referred to as the historical capital of Europe and in 1834, it became the capital of the modern Greek state. In two centuries since that time, it has become an attractive modern city with unrivalled charm that is by far Greece’s most visited destination.
if you receive income in Greece and in particular a real estate revenue, you will have to pay the individual “non-resident” income tax. Therefore, each year, it will be necessary to file an E1 tax return. Property income is taxable at 15% up to €12,000, 35% between €12,000 and €35,000 and 45% for annual rental income above €35,000.
Income from holiday rental is not subject to tax if the duration of the rental does not exceed 90 days per year and 60 days on islands with less than 10,000 inhabitants. It is possible to rent for longer, but if the income reaches €12,000 per year, the owner will be liable for the income tax.
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