Introduction - Purchase & Living cost - Buying guide
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Introduction

Greece, in particular Crete, has proven over the last years to be one of the more popular destinations for Europeans that seek either a holiday or a retirement home. Demand for the island is increasing at a rapid rate as the buying process is relatively straightforward and any EU member can purchase a property. It also has the benefit of mortgages available to foreigners.

The main advantages of Crete are as follows; the climate, the diverse landscape and environment, the cost of living, the low crime rate, part of a non-volatile EU country and the warmth and hospitality of the Cretans.

Please take the time to read through this information and if you have any questions do not hesitate to give us a call.

Purchase & Living Cost

Typical Payment Terms

• Deposit 10 to 30%
• Remaining final payment due around 4-6 weeks.

Purchasers Expenses

• The transfer tax is about 9-11% on the objective price or if the agreed price is bigger than the objective price, on the agreed price. (For new built properties [building permission granted after the 31/12/05] the transfer tax is replaced with 19% VAT)
• The lawyers fee is about 1% on the selling price depending on the legal research and any other legal advice had offered to the client.
• The notary's fee is about 1% on the deed of purchase mentioned price.
• The estate agents fee depends on the agreement between the estate agent and the purchaser, although the rate is normally 3%.
• The registration at the register office is about 0.5 % on the price mentioned on the deed of purchase.
• Municipality tax: This amounts to 3% of the above transfer tax and is also payable to the local tax authority.
  

For more information and legal assistance visit http://www.e-lawnet.gr/en/

Example: If the contract/property value is 100.000 Euro, then the relevant costs are:

• Lawyer's fee: (44.020 * 1%) + [(100.000 - 44.020) * 0,5%] = €720
• Public notary: 100.000 * 1% = € 1.000
• Transfer tax: (15.000 * 9%)+[(100.000 - 15.000) * 11%] = €10.700
• Municipality tax: 10.700 * 3% = € 321
• Registry of Mortgages: 100.000 * 0,5% = € 500
• Estage agents fee: 100.000 * 3%=€3000 + 19%VAT= €3.570
• Total Expenses: €16.811

Yearly costs related to property ownership

Yearly property taxation in Greece is limited to the following:

• Local municipal tax: The council tax ranges from 0.025 % - 0.035 % on the assessed value of the property and is incorporated in the electricity bill.
• Yearly property / wealth tax: Owners of property pay a yearly property tax ONLY if the assessed value of their ownership/s exceeds the amount of 243.000 €. The tax amounts 0.3 % to 0.8 % of the assessed value of the property.

The costs of living in Greece

If you live in Greece and do not work, the only taxes/expenses will be utilities - electricity and water, including public sewage if you have it. For the property you own you have to do a tax declaration at an accountant you appoint.

Buying Guide

Foreigners buying property in Greece

Greek property is available to all EU citizens with the only restrictions being land in close proximity to military bases. In areas near the national borders and in some islands, non-EU citizens require a special permission by local Council in order to purchase property. This permission tends to be a formality for non-controversial nations.

Mortgage / Financial Advice

Several leading Greek banks offer mortgages to permanent non-Greek residents upon the purchase of a home in Greece. Though not yet as easy and simple as the UK, you can normally borrow up to 60-70% of the value of the property.

If you are purchasing a property in Greece, Aquavista can recommend a UK based mortgage company.

Type of Greek Mortgage: Repayment Mortgage only Minimum: € 40,000, No Maximum, but must not exceed 80% of valuation or purchase price (which current variable interest rate is approx 4.95%).

Procedure

Once you find the house that suits you, and you decide to proceed with a purchase, you will then need to follow these basic steps:

• 1. Appoint a Lawyer
  The Buyer must appoint an attorney to assist him with and represent him in the process. Our partners can either provide you with a list of reputable real estate attorneys in Greece or immediately assign one for you, subject to your consent.
• 2. Appoint a Public Notary
  A public notary must be appointed since any property purchase agreement, in order to be valid, must be done in the presence of a public notary.
• 3. Get a copy of the title deed and perform a title search at the Registry of Mortgages
  The buyer must obtain the contract deed (title) held by the vendor. This can be done with the help of the lawyer. It is then the lawyer's obligation to search the title deed at the registry of mortgages. The search must be carried out in order to secure that:
  ° The vendor holds the absolute deed of the property.
  ° The property is unencumbered.
  ° All property taxes burdening the vendor have been paid.
  ° The construction was completed in accordance to all planning and building permissions. Only if the title deed is secure should the buyer proceed to contract.
• 4. Issue a tax registry number
  A tax registry number must be issued for the buyer, to be able to proceed with any transaction. The tax registry number is applied for and issued by the Inland Revenue Service.
• 5. Pay the transfer tax
  The transfer tax must be paid to the local Inland Revenue Service by the buyer prior to signing the contract. This can be done with the aid of the attorney.
• 6. Signing the contract
  In order to have a valid contract, it must be signed in the presence of a public notary. When the contract is signed, the notary registers the transaction at the local registry of mortgages.
• 7. Effect transfer at the Registry of Mortgages
  The buyer's attorney makes sure that the title is transferred to the buyer's name by obtaining the relevant certificate from the Registry of Mortgages.
• 8. Notify the Land Registry for the transfer (if applicable)
  A copy of the title, and the certificate from the Registry of Mortgages is needed to register the property under the buyer's name at the Land registry. Not all regions of the country have a Land registry, as Greece is currently undergoing the process of establishing a Land Registry. In areas that do not yet have a Land Registry, ownership of property is based on and secured by the local Registry of Mortgages.

Letting
Management / Letting

Requirements for obtaining a license for house rental from the Greek National Tourist Board (EOT) [can be undertaken through the building department of our partners]

• Application form.
• Declaration by applicant
• Rental agreement.
• Certificate form the Fine Service.
• Statement of suitability of the property.
• Certificate stating that both water and cesspit arrangements attain the required criteria.
• Criminal record of the applicant.
• Health certificate of the applicant.
• Receipts of payments of local taxes required.
• Latest tax return of applicant.
• Verified photocopy of planning permission of the building.
• Verification that the building is anti earthquake proof etc, signed by qualified architect.
• Plans of house plumbing etc signed by qualified architect.

Management services

Our agents have experience and knowledge in assisting clients with the purchase of their homes in Western Crete.

An obvious concern is how you are going to look after the property when you are not there, our agents now offer a excellent trustworthy management service for a fee.

Before you rent your house for long term (min. 3months) you must sign a contract and submit it to the tax office. It is forbidden to rent your home to the tourists without obtaining a special license from the Greek National Tourist Board (EOT.), please note for apartments an EOT licence will only be granted when the whole community is obtaining for it in all.

Other Information

Residency

EU citizens wishing to stay in Greece for more than three months are officially required to obtain a residence permit. Application must be made in person at the Aliens Bureau in Athens (173 Alexandras Ave) or at the nearest police station in other locations.

Documents required:

• Copy of passport
• 4 photographs
• You may be asked to show a bankbook to prove you can support yourself
• If employed, a letter from your employer
  
  

Work Permits

Non- EU foreigners who wish to work in Greece must have valid work and residence permits. The perspective employer prior to the alien's arrival in Greece for the purpose of working must obtain approval from the Greek authorities. Before such an approval is granted, the Greek authorities consider the possibility of filling the position with an unemployed person from other parts of the country. Preference is given to Greek citizens, citizens of the European Community countries, persons of Greek extraction and aliens who enjoy refugee status and reside legally in Greece.

Medical Insurance

The citizens of the European Union have right to the E111 document, which offers the access to free treatment in a public hospital. Greek public hospitals are well equipped, at least in the major cities, but are often overcrowded. The conditions and services of the private hospitals are much better but are quite expensive. A good health-insurance policy is essential.

Taxation Information about foreigners

Before you made the following actions you should advise an accountant in order to avoid future problems in your tax return. According to Greek taxation legislation you are obliged to fill in a tax return. The tax return is submitted every March and concerns the previous year.

In case you are purchasing a property in more than one name, please ensure transferring all amounts from a joint bank account or if you use separate ones to send the amount divided according to the percentages of ownership of each of the purchaser AND keep the "pink slips" from your money transfers for the tax office, avoiding income taxation in Greece.

There are international tax agreements of avoiding double taxation with almost all European Countries. Please seek independent financial advice or visit www.inlandrevenue.gov.uk

When you transfer money in Greece.

If a money transfer is required, bank charges will also be payable. Aquavista has a specialist foreign currency partner who gives far better exchange rates and commission free transfers compared to UK banks. This can save thousands of pounds on a property purchase, please contact us for further details.

 

To view previously asked questions on purchasing property in Greece, or to ask your own question click here

 

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