Why a house in Greece
In recent years there has been an increasing demand for real estate in Greece. There are many reasons that make Greece an ideal country for a second (or even first) home.
Greece has a typical Mediterranean climate, with mild winters and dry summers, and almost year-round sunshine (320 days a year). The warmest period is the end of July – beginning of August, with average temperatures between 29 and 35°C (84-95°F), but it is during this period that the annual north wind from the Aegean Sea causes pre-cooling.
Large variety in landscape
Greece has an enormous coastline, with 3000 islands, 138 of which are inhabited. They provide beautiful beaches, small bays, sun and sea. The Greek archipelago is a sailing paradise par excellence. A country full of history, myths and countless archaeological sites. But the great attraction of Greece remains of course the sun and the sea.
Greece is the country with the most airports in Europe (more than 45). Every corner of the country can be reached daily, either directly with a charter flight or with a layover in Athens. By car, Greece is easily accessible via Italy; from several Italian harbours you can make the crossing by car with one of the many luxury ferries.
Greek law is partly based on German and French law. Property is sacred, as in the Netherlands and Belgium for example. The protection of property is seen as a fundamental right and is enshrined in the constitution. When legal procedures are completed with due care, the buyer is 100% owner, without restrictions, reservations or small print.
Unlike countries such as Spain and Turkey, Greek law prohibits the construction of mega-projects. Thus, outside the village limits, a maximum of 200 sqm can be built on a plot of at least 4,000 sqm. The house to be built may then not be higher than 7.5 meters. These strict building regulations – in combination with the landscape – have ensured that no projects with hundreds of houses can be found in Greece.
The strongest selling point for Greece may not be directly measurable, but therefore no less perceptible. Ask the average visitor in Greece this question and you will always receive the same answer: the Greek hospitality. Together with all the above, more rational arguments, Greece is for many the ideal country to buy a second home, on the gorgeous mainland or one of the many beautiful islands, overlooking the infinite azure blue Greek sea.
- English (and Dutch) legal guidance from start to finish
- Almost 30 years of experience in the field of Greek real estate: excellent knowledge
- Your point of contact in English (or Dutch)
- English (and Native Dutch)-speaking Greek lawyers at your service
- We provide a solid bilingual contract in English, (Dutch), and Greek
- We take care of the application for a Greek tax number, we help with the opening of a Greek bank account etc.
- We take care of the entire settlement of the sale: cadastral survey, notarial transfer, registration in the land register
- Advice on legal, fiscal and practical matters
Is it useful to use a real estate agent?
As a foreigner without much insight into the local market, it is advisable to resort to the services of a real estate agent.
Various types of real estate agents are active in Greece.
- The large brokerage firms mainly located in Athens and dealing with the upper part of the market.
- The small ‘traditional’ Greek real estate agents, often very capable but not always service-oriented offices that sometimes want to get the deal done too quickly.
- Brokerage offices in the more touristy areas working mainly with Western European clients. It is necessary to inquire locally about the reputation and service of the real estate agent.
- The intermediary agencies in the buyer’s home country, specializing in Greece. Elxis has been doing this work since 1991, to the great satisfaction of dozens of customers each year. The advantage of this is that you have your point of contact and get answers to your questions in English and can discuss everything with our experienced brokers and legal experts.
You must sign a clear written agreement with an authorized broker, stating the agreed brokerage fee, in a language you understand. Never sign anything in Greek if you do not know exactly what it says.
The brokerage fee is freely negotiable; for most Greek real estate agents it varies between 2% and 4%.
Is it mandatory to use a lawyer?
Many of the notary’s duties in Greece are handled by the lawyer. For years, according to Greek law, when signing the sales contract, both the seller and the buyer were obliged to be assisted by their own lawyer. In the context of market liberalization, this legal assistance is no longer mandatory.
In practice, however, the role of the lawyer is indispensable, as he takes care of a number of pre- and post-contractual actions that are essential for the course of the transaction. This is certainly the case for people who are not familiar with the Greek legal system and the Greek real estate market.
Elxis has its own English (and Dutch)-speaking lawyers who explain everything and take care of the whole process, from cadastral survey to cadastral registration.
What is the role of the notary in buying a house?
The role of the Greek notary in real estate transactions differs substantially from the role of, for example, a Dutch and Belgian notary. It is not the task of the Greek notary to receive the purchase sum, pay the seller and the real estate agent, nor to pay taxes or take care of the land registration. He is only a representative of the Greek state who ensures that the transaction takes place as required by Greek law.
He advises the parties concerned, maintains the public real estate registers, calculates the taxes, passes the deed and provides the official copies to the parties. His role is thus more coordinating than executive. All the ‘work in progress’ is in practice done by the buyer’s lawyer.
Can I also go to Elxis if I have found a house myself?
Yes, more than a third of our clients have found their dream house themselves and then asked us to supervise and handle the purchase. We will assist during the first discussions with the seller, negotiating the price, making arrangements by means of a private agreement, cadastral survey, and notarial settlement.
We take good care, so that you will have a nice home.
House found, price agreed, what now?
When the seller and buyer have agreed on the purchase price, the seller must transfer the title (deed of purchase, deed of gift or inheritance etc.) of the property to the buyer. The buyer should hire a lawyer, preferably one with whom he can communicate in a language he understands, and hand him the title deeds so that he can check their authenticity with a competent mortgage register.
The examination of the title deeds is essential and must be carried out with due care. After all, it is the legal foundation of your home. The examination includes a check of the legitimacy of the titles and the existence of any liens on the property with the competent mortgage registry. This examination must cover a period of at least 20 years (due to prescription periods). Moreover any possible preexisting liens should also be checked and, finally, the search will also tell the buyer if there are any claims on the property by third parties.
After the title deeds have been checked and found to be in order, a notary is appointed by the buyer. Based on the existing title deed and the details of the contracting parties (for the buyer, the details of the proof of identity and a Greek tax number are sufficient), the notary draws up a draft deed of purchase and calculates the amount of taxes and other costs. The buyer (or his lawyer) pays the taxes before the deed is executed and submits a proof of payment to the notary, which is attached to the deed.
After signing the deed, the notary hands over a copy of the deed to the buyer’s lawyer. The latter then ensures that this copy is filed (‘transferred’) with the mortgage register. From this moment, i.e. as soon as the deed is entered in the public registers held by the local mortgage register, the purchaser is also formally the legal owner of the property.
Elxis has now proven its value in this field for almost 30 years. The legal foundations of a house are just as important, if not more important than its actual foundations. We understand very well that our clients often entrust all their money to us to realize their dream home in Greece. And we don’t take that lightly. Should something even remotely suspicious crop up in our investigation of the ownership titles, we’d rather see this transaction fall through then opt for a ‘quick buck’. As a result the ties we build with the vast majority of our clients extends to more than a purely business relationship. Our clients are always welcome to consult us for any matter even years after they make their purchase. For them it might be a new matter, for us it’s daily practice.
Do I need a Greek tax number?
Yes. The tax number (AFM) is mandatory for all (legal) persons who want to buy real estate in Greece, regardless of nationality.
The procedure for obtaining it is quite simple. A tax number is issued free of charge by the tax authorities on presentation of a valid identity document and after completing a special application form.
If you have given us a power of attorney we can apply for the tax number on your behalf.
Do I need to open a Greek bank account?
A Greek bank account is not a requirement. However, the Greek tax authorities must be provided with transparency regarding the origin of the funds required. If you are unable to prove the origin of the money, you run the risk that the Greek tax authorities will consider the amount of the purchase price and the transfer costs as income acquired in Greece and levy income tax on it! We will show you the way so that this happens according to law.
A bank account in Greece can be useful once you own a house in Greece, for example to pay the energy bill by automatic direct debit.
In order to open a Greek bank account, you will need to deposit a number of documents with the bank, based on European directives. Most banks require the following information:
- Greek Tax Number (AFM)
- Copy proof of identity
- Proof of your home address, e.g. an extract from the civil registry or a utility bill (electricity, water, telephone)
- Employer’s declaration or extract Chamber of Commerce
- Tax assessment
In the past, it was possible to have a bank account opened by proxy. This is no longer possible at European level in the context of the fight against money laundering. As a result, the personal presence of the account holder(s) is required when opening a bank account.
What are the transfer fees?
For the calculation of the transfer fees, the specified contract value serves as the basis. The tax authorities check the declared value against the “objective fiscal value” of the property, which is determined by the Ministry of Finance. This fiscal value serves as the lower limit for the tax to be paid.
The amount of the transfer costs (purchaser’s costs) depends on whether it concerns a) a new home or b) an existing home or lot. In the case of new construction, VAT has been due since 1 January 2006, while transfer tax is payable on existing construction and building plots. This has been greatly reduced as of 1 January 2014. The ‘objective fiscal value’ is also the lower limit for VAT. If one buys a new building off-plan, however, in many cases legal constructions are possible, as a result of which these costs can be significantly reduced.
The transfer costs consist of the following items:
|Existing house or lot||Percentage||New construction||Percentage|
|Notary costs||1.8 – 2%||Notary costs||1.8 – 2%|
|Cadastral dues||0.5%||Cadastral dues||0.5%|
What should I pay attention to if I want to build a house myself?
For building land that is situated within the architectural plan of a town or village there are no substantial restrictions with regard to the building possibilities. However, the owner must obtain information from an architect / civil engineer about what may and may not be built.
For building land that is located outside the city plan there are fairly strict restrictions. With a few exceptions it is only allowed to build on lots outside the city plan if they have a surface area of at least 4,000 sqm. A maximum of 200 sqm may then be built on such a lot (excluding storerooms, garage, terraces and swimming pool). The issuance of a building permit takes several months and is valid for 4 years, with a possibility to extend it for another 4 years.
When buying real estate outside the city plan in an area where there is a suspicion of an archaeological site, one should contact the Archaeological Service and ask for investigation. Furthermore, a declaration should be requested from the Forestry Service confirming that the plot is not part of forested area, as building in forest areas is not allowed.
Is there an annual property tax?
Property tax was introduced in Greece a few years ago and is calculated based on the size of the house and the plot.
For houses, this tax is calculated based on the size and location of the house and the plot the house stands on. For most (vacation) homes this tax is 3 to 4 euros per square meter built (for a house of about 100 sqm you thus pay 300 to 400 euros in annual property tax). The annual assessment for this tax (ENFIA is the Greek abbreviation) can be downloaded online from the website of the Greek tax authorities. You must have a username and password, which must be requested from the tax authorities. The representative who arranges your tax affairs in Greece (usually an accountant) will have these login details or can request them for you.