12 Steps to Buying Property In Greece
Greece is famous for its hot summers, beautiful beaches, low cost of living and wealth of historic, cultural and scenic attractions. If you have seen a property in Greece that you wish to purchase, please read on.....
Generally speaking, there are no restrictions to foreign nationals acquiring real estate in Greece. Once you have purchased your property, you become the freehold owner in perpetuity. The good news is that once you have found your new home and secured financing, completion of the process should not require more than 6-8 weeks. The bad news is you need to add about 20% to the purchase price to cover costs such as taxes, fees, and the hiring of attorneys and notary publics.
•1. Work with a real estate agent. This will help insure a smooth transaction with a professional who knows the market and the laws. In Greece, less than half of all real estate transactions involve a real estate professional, but that number is on the rise. Be advised that whoever hires an agent, pays the agent. So, if you as buyer, decide to hire an agent, you will pay their fee. If the seller hires an agent to market their property, then they will pay the agent their fee. The typical fee is 2-4% of purchase price.
•2. A preliminary contract is drafted between the seller and buyer which is signed by all parties involved. This preliminary contract outlines the description of the property, boundaries, the negotiated purchase price, commissions paid to real estate agents, etc.
•3. A deposit of 5-10% is needed to secure property. If you back out of deal, you will lose your deposit, and if the seller backs out of deal, you are entitled to receive double the deposit in damages.
•4. Obtain a local tax roll number (AFM) which gives foreign nationals permission to buy property. This number is very important, so keep it handy. You will need it to open a bank account, turn on utilities, or propose planning/development. To get this number, you need to fill out an M1 and M7 tax form. Non Greek residents have to designate a Greek resident to receive all communication while you are out of the country. The easiest way to do this is to issue a power-of-attorney to someone in Greece you trust.
•5. Open a bank account in Greece since all monies to fund transaction must come from a Greek bank. A person from another country interested in buying property in Greece will need to obtain what is known as a "pink slip" for wire transfers of money from abroad. Greek authorities are very concerned with where the money to purchase a property came from. If you cannot provide a "pink slip", be prepared to pay an income tax on the money wired in to fund the transaction.
•6. Hire a civil engineer to inspect and analyze the property, both structurally and to ensure the boundaries of the property are not encroaching on the neighbor's. Obtain a Topographic Survey.
•7. Hire a bilingual attorney to represent you in Greece for the purchase of the property. The Buyer must appoint an attorney to assist him with and represent him in the process.
•8. Your attorney will draw up the final contract with seller insuring the seller has the right to sell and that there are no outstanding debts. (S)he will also determine that the construction was completed in accordance to all planning and building permissions, and the property does not encroach on another's land. Attorney's negotiated fees are typically 1-2% of sales price.
•9. You or your attorney will hire a Public Notary, a State Official who is a neutral party in the transaction, who will prepare all the other documents needed to purchase property. In Greece, this person is called the Symvoulografo. In order for any purchase agreements to be valid, they must be done in the presence of a Public Notary. You will pay the Public Notary a fee that is usually about 1-2% of the amount listed in the deed of the sale.
•10. You will also need to pay the transfer tax that is payable to the local tax authority and amounts to 9% for the value up to 15,000 Euros plus 11 % for the value above 15,000 Euros. In areas that are not covered by a fire department these figures drop to 7% and 9% respectively.
•11. Once all the necessary legwork has been completed and both the attorney and the Public Notary give their approval to convey property, the formal transaction takes place at the Office of the Public Notary. The balance of the purchase agreement is paid at this time. Once the contract is signed and agreed upon by all parties and the Public Notary insures that the documents comply with Greek law, the property is conveyed and sent to the Land Registry for Registration of title. This fee amounts to 0.45 % of the property value.
•12. Congratulations! You now own property in Greece! Giamas! Cheers!
** Be sure to also speak with your tax advisor both in the US and in Greece for taxation requirements.
If you are interested in purchasing a property in Greece, please contact me. I know of several properties that may be of interest.
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