On many levels, buying property in Greece - particularly if you are a foreign national -- can be a rather complicated and sometimes confusing process. However, by understanding the process up front, and by understanding the various requirements and regulations that apply to foreign nationals seeking to buy real estate in Greece, a foreign citizen can successfully acquire property in Greece.
As a general rule, a foreign national actually can purchase real estate in most locations in Greece. However, a foreign national who is not from a European Union nation must obtain the prior approval from the local prefecture in certain areas in Greece: some regions of northern Greece, Rhodes and Crete. Obtaining this permission from a local prefecture generally does not take a great deal of time and usually is granted without significant fuss.
Before anyone -- a citizen of Greece, the EU or another foreign national -- can purchase real estate in Greece, that person must first obtain a tax identification number, known in Greece as AFM. This number is easy to get and can be obtained at any tax office in the country. Citizens of Greece or another EU nation need only show their government issued ID card. Citizens of other countries must show a passport to obtain the AFM.
A public notary -- who is an independent government official -- oversees the real estate purchase process. Once an offer is made on the property, a preliminary contract is drafted. A deposit of up to about 10% is placed on the property at the time this agreement is executed. (The deposit is not refundable unless the seller somehow disrupts or ends the sales process or unless clear title to the real estate cannot be had in the time allotted under the preliminary contract.) After the buyer obtains his or her financing, and the seller satisfies his or her own obligations under the preliminary agreement, a final contract is signed between the parties.
With the execution of the final contract, the ownership of the property will be conveyed legally to the buyer. The final contract is signed before the public notary. In addition, according to Greek law, the real estate agent or agents who have been involved in effecting the sale must be present for the signing of the final contract.
Fees
Extra costs when buying property in Greece
Assessed Tax Value
Most fees are based on the 'assessed tax value' ( antikimeniki axia) of the property, which at times may be lower than the actual price paid. How much lower depends on the location of the property - property in resort areas or on islands tends to have a higher tax value than that in remote or less popular areas. The 'assessed tax value' is calculated by the local tax authorities based on government tables using criteria such as the location, size and characteristics of a property. This is the minimum value that can be declared on a purchase contract.
In some rural areas the value can be negotiated, but in most areas it's fixed. You should ask your lawyer to ascertain the 'assessed tax value' of the property you plan to buy and to obtain confirmation in writing.
The fees or additional expenses payable when buying a property in Greece may include the following:
Purchase or transfer tax;
Value Added Tax (new constructions only);
Land registry fees;
Notary's fees;
Lawyer's fees;
Community or municipal tax;
Surveyor's fee (optional);
Brokerage agent's fees;
Utility fees.
Purchase / Transfer Tax
The main additional expense when purchasing a property is the purchase (or transfer) tax. This tax is based on the purchase price shown on the contract and at any rate never below the 'assessed tax value' (see Assessed Tax Value above). Purchase tax is payable by the buyer at 7 per cent on the first 15,000 euro and at 9 per cent on the remainder, unless the property is situated in an area covered by a public fire protection service (this includes most areas that are popular with foreign buyers). If this is the case, the rates are increased to 9 per cent on the first 15,000 euro and 11 per cent on the remainder. For example, if the property you're buying is in an area with a fire service and is valued at 100,000 euro, you would pay a total of 10,700 euro purchase tax (1,350 euro on the first 15,000 euro plus 9,350 euro on the remaining 85,000 euro).
Purchase/transfer tax must be paid before the final purchase contract is signed and the notary requires proof of payment (the receipt) in order to authorize the sale. The intricacies of purchase tax make it almost mandatory to obtain legal advice before proceeding with a property purchase.
Value Added Tax (VAT)
New constructions with a building permit issued from January 1, 2006 and later are subject to VAT at the current rate of 19 per cent. New constructions with building permit issued before January the 1st 2006 aren't subject to VAT regardless of when building work is completed. If this tax is paid there is no purchase/transfer tax.
Land Registry Fees
Land registry fees are from 0.3 to 0.5 per cent of the amount shown on contract plus a small sum for stamp duties and certificates.
Notary's Fees
The fees for the notary, who draws up the final purchase contract and officiates the sale, are usually between 1 and 2 per cent of a property's contract price. Fees also include small set charges for each sheet and document included in the contract.
Legal Fees
Legal fees for the conveyance involved in a sale are up to 1 per cent of the 'assessed tax value'. The actual fee depends on the value of the property. You and your lawyer should agree the fees in writing beforehand. Engaging a lawyer is recommended.
Community or Municipal Tax
A community tax at 3 per cent of the property transfer tax is paid to the local municipality for general public services such as road maintenance. Note that this tax is paid at the same time as the purchase tax to the central tax office.
Surveyor's Fees
If you employ a surveyor to inspect a building or plot of land, the fee will depend on the type of survey, any special requirements and the value and size of the property or land. A survey costs from 250 euro.
Brokerage Agent's Fees
Estate agent's fees set at 3,5 per cent of the actual purchase price, payable by the buyer at the transfer of the property at the notary's office.
Utility Fees
If you buy a new property you usually have to pay for electricity, gas and water connections, and the installation of the meters measuring consumption of these services. You should ask the builder or developer to provide the list of this cost and any other costs in writing. In resale properties you will probably have to pay for the cost of new electricity and water contracts, security deposit.
