1. LEGAL PROCEDURE
Greek laws authorise foreigners to own properties in most areas of Greece. Restrictions apply for Non European Union citizens who wish to purchase property in border areas (East Aegean, Dodecanese islands, regions of Northern Greece, Crete, Rhodes) Non European Union citizens who wish to purchase property in border areas should apply to the Council of local Prefecture which grants authorisation. Some agents offer assistance with this procedure.
Deposit
To secure a chosen property, a 10% deposit on the purchase price is usually required on signing the agreement. This agreement contains the names and description of the parties, the description of the property, the price, the methods of payment and any general conditions negotiated by the parties. Sometimes in the case of a very cheap property this agreement does not take place and the parties move straight to an exchange of contract phase executed before a Notary Public with the two lawyers representing the parties. The Notary Public will not authorise any sale without making sure that all the appropriate tax papers and deeds are in order.
The purchaser will lose the deposit if he backs out of the deal. If the vendor backs out and a pre contract has been signed, he will have to pay a sum equal to the deposit, as an indemnity to the purchaser, who, of course, gets the original deposit back.
Purchase
The property transaction is always executed before a Notary and in the presence of lawyers representing the seller and the purchaser. A purchaser needs a lawyer to act on his/her behalf in order to assist with the Local Regulations to fix the "assessed value" and ensure that he/she obtain a clean property title. Before the transaction takes place, the lawyer representing the purchaser carries out searches with the Land Registry and assures that the property has a clean title. Legal procedures in Greece are simple and if all the papers are ready and in order a sale can be completed quite quickly by signing an official contract prepared by the Notary.
Expenses
The Purchase tax, Notary and ~ fees, in Greece, are always paid by the purchaser and they are calculated on the "officially estimated price" of the property, which is usually lower than the true purchase price.
The purchase tax is between 9%-13% (on the first 15.000 the tax is 9% and on the remainder the tax is 11%-13%). In some cases where there is no fire station in the area the tax begins lower at 7%. The Notary's fee is 2%. The Lawyer's fee is between 1.5% and 2%.
Notice:
All prices in Crete are quoted in the new currency Euro. This is bound to lead to some confusion on the part of the vendors and therefore all prices should be doubly checked with the person showing the property, who will then check again with the vendor at the time of a prospective purchaser making an offer to buy. We are not responsible for price changes by the owner.
II. LOCAL TAXES
Owners of properties are subject to a very small Public Tax which is incorporated in the electricity bill payable every second month.
III. PROPERTY TAXES
According to a fairly recent law owners of real estate property whose "assessed value" or "objective value" exceeds the amount of 175.000 Euro or 350.000 Euro for a couple are subject to property taxes. As an example for real estate property whose "objective value" is estimated at 322.800 Euro and only having one owner, the yearly tax would be about 440 Euro about ?300 sterling.
IV. PLANNING PERMISSION
According to the Greek laws, if a plot of land is not within the town plan and if there are no forestry or archaeology restrictions, permission to build can be granted for any plot of a minimum 4,000m2. Permission can be granted for plots of land of 2,000m2 or less, if they are located within the planning zone or with frontage to principal municipal road. Inside villages, towns and cities planning permission can be generally granted for any plot. For some Greek areas there are specific Greek laws that apply about planning permission regulations.
Most reputable agents can recommend skilled architects, and engineers who will give advice, work on plans and carry out the procedure for building permission. Building permits can be obtained through registered architects or engineers in Greece and cost approximately 4% -5% of the total cost of the building.
V. BUILDING COSTS
As a very general guide building costs per m2 are in the region of 1.000 to 1.500 Euro depending upon the materials used, in certain locations (difficult access etc.,) the building cost might reach 1.600 Euro.
VI. RENTING YOUR PROPERTY
Although many agents for Greece do not specialise in renting out property, most of them will recommend good properties which they know & the sale of which they have handled for short term letting to clients seeking to purchase. This is usually a free service of good will. Other agents specialise in letting and are the ones who should be approached if the property has been purchased with a view to investment.
VII. PROPERTY MAINTENANCE
During the last few years we have often been asked about Property Maintenance. Subsequently, several small companies or individuals in certain areas have set up in business to offer this service. Whilst we are happy to pass on their names and details to you.
VIII PURCHASING FOR NON EU CITIZENS
Whilst EU citizens can freely buy properties in Crete, there are certain restrictions for those people outside of the European Union. However it is possible for non EU citizens to purchase in Crete. It will in general take about 3 months longer. It is necessary for your lawyer and notary public to apply to the Minister for the Interior in Greece and the office there will investigate your position in the community and ensure that you do not have a history of any kind which might be detrimental to the security of the island, this is because Crete is considered to be a border territory. Should you be prepared to go through this process then please fell free to ask for our up to date property lists.
IX BUILDING FROM SCRATCH
These are tips, and are not meant to put you off buying a plot and building the house of your dreams but they might help prevent your dreams becoming nightmares!
Please make sure that you have a proper contract for building work with the builder and/or architect in Crete in the same way that you would have in the UK if you were getting new building work or renovation done, for your own protection.
Make sure you are completely compatible with the architect you choose. Architects in Greece hold much more power than those in the UK it is not really possible to fire them. Once they have obtained your building permit they are responsible for signing to say the building's footings are correctly installed and for signing off the job so that you can have your services connected and your building is legal.
Spend the time and money to take photographs of the land and get some sketch plans of your ideas drawn up here in the UK . This way you will be able to shop around for an architect in Crete who agrees with your ideas (in so far as they are legal within the building laws) without making the complicated decision of choosing an architect before he does your sketch plans.
Check that IKA, VAT and the cost building permit etc., is included in your contract or not. if one quotation seems vastly more expensive than another it could be that the IKA, Vat and building permit price is included and the lower quotation does not include them. In general these costs are outside the contract.
Do have a clause in your architectural contract that you may choose the builder of your house independently of the architect if you so desire. Unlike the UK where an architect cannot also be a builder, in many case in Greece the architect and the builder are one and this creates a conflict of interest.
Bear in mind that a plot of land within the village limits or one with an old building on it (unless it is protected) poses less problems and expense than a plot outside the village/town limits.
Services
DO
Make sure that if you are buying a plot outside the village limits you know what your costs will be for services.You might see an electric pole nearby and be told the price of the one you need to your houses is only 600. However you could be the unlucky one that is just out of range and a transformer might be needed. A transformer costs many thousands of pounds and the cost of it is not shared between you and anyone else who might build near to you later. They are the lucky ones and you could be the unlucky ones.
For detached houses standing in their own plots outside the village or town limit now the electric meter has to be placed in a concrete structure on the edge of your land. This has to be built by a registered electrician and will be an additional cost to the connection and or electricity pole charge.
Water: if there is no mains water nearby your land you might have to allow for a very large water tank to be built because water delivery is a set amount of gallons and it is more economic to have a tank which takes the entire load. If you have bought land which is rocky this could be an expensive item which almost certainly will be additional the quotation of the building.
Sewerage: If the land is rocky building a seepaway tank could be costly because of the drilling involved, this is something you can get some kind of quotation on before you start.
