What you need to know prior to purchasing your property in Greece
The following are general tips regarding the steps you ought to take if you wish to buy with safety a real estate in Greece. If you have any queries, please do not hesitate to contact us free of charge.
Choose carefully the real estate which you wish to buy by surveying the local real estate market, with an eye to noting the average price prevailing therein. If your economic capacity corresponds to the value of the property, request information as regards the real estate’s features (e.g. in case of a plot of land, ask which is the permissible area for building and the type of building allowed to be built thereupon) and assurances that the said real estate is not affected by any encumbrances. Moreover, you should request the legal title of the transferor to the property and a title plan linked to the Hellenic Geodetic Reference System of 1987 (HGRS1987), based on which the Hellenic Cadastre has been developed or the cadastral survey is conducted in regions that have not yet been incorporated into the Hellenic Cadastre. You should further request a copy of the cadastral sheet and the cadastral diagram. Subsequently, you should bargain the property’s price in order to know the final price at which you can buy it.
Do not agree on the price and do not pay any amount in advance, unless a meticulous planning control is conducted by a land surveyor, accompanied by a review on the legality of the real estate. As far as it concern the transaction’s security, it is of paramount importance that the planning control and the legal review are conducted by people of your choosing rather than people indicated by a third person or, even less so, by the real estate’s owner. You should remain in direct contact with them while the controls are ongoing.
The planning control entails inspection of the property by the land surveyor and verification of whether the building permit has been legally issued or has been excessively applied. In case the threshold set by the permit conditions is exceeded, the purchaser risks being fined for illegal development. For plots of land excluded from urban planning, it is essential, as part of the planning control, to make an inquiry as to whether the archaeological or forestry authorities have imposed any restrictions which may limit or restrict any development thereupon, or whether they will be expropriated.
The legal review comprises all the work necessary in order to ensure that the land concerned by the transfer is not encumbered, is free of any legal defects and is not claimed by any third party. Binding of property by a lease or due payments to the Social Insurance Institute (IKA) is not a considerable defect.
After legal review and planning control have been completed, you may reach an agreement on the property’s price.
If there is no document needed prior to the drawing up of your contract, we strongly advise you not to conclude any pre-contract agreement that requires you to pay to the seller any deposit or, even less so, the sale price of the land in full. Your interests are safely protected by paying the entire value of the real property as soon as a contract is drawn up and signed, and in no case when a pre-contract agreement is concluded. The acquisition of ownership is completed only with the signing of the contract and its entry in the competent Registry of Mortgages or Land Registry (depending on whether the acquired property is within the urban plan or not). It is better not to purchase a property of your choosing because you did not pay any amount in advance rather than purchasing a property which lacks the desirable planning features, or has got structural, planning or legal defects.
A notary public shall draw up the contract which shall be consequently entered in the competent Registry of Mortgages or Land Registry, if the property referred to in the registrable deed comes under the competence of the latter.
On the purchase, a one-off E9 tax return has to be submitted, the purchaser shall be paying an annual Unified Property Tax (ENFIA) and, in case the property generates an annual income, he/she shall be paying an income tax. The property’s value is calculated according to the rateable value of property table provided by the Ministry of Finance, rather than based on its commercial value.
The financial burdens for the buyer are:
1) Property transfer tax
2) Stamp duty for entry in the Registry of Mortgages or Land Registry
3) Notary public and lawyer fees.
Our firm’s services include the provision of legal review and legal assistance during the drawing up of such contracts and the negotiation of the property’s final price on behalf of the purchaser, if he/she sees fit, in order to achieve the lowest price possible. We do not act as real estate agents. We can put you in touch with qualified engineering firms which shall conduct the planning control. Both legal review and planning control will be completed in the shortest period possible, as long as they are conducted in a reliable manner.
Kostantinos Arapoglou