What’s the property market like in Greece?
It’s no secret that the Greek economy is in a bad state– after a major crash in 2009, the nation has struggled to regain footing. That being said, the economy is slowly growing; predictions show a 2.7% increase for 2017 and another 3.1% in 2018.
The housing market, however, is showing a significantly slower recovery. Property prices have dropped by nearly half since the market’s peak in 2008, though the ongoing downward trend seems to be slowing. According to the Bank of Greece, the reported .46% drop in prices was actually a .03% increase when adjusted for inflation. The number of real estate transactions, however, remains abysmal, maintaining a 72% decrease since 2008.
Through a wider lens, it’s clear that the housing market is on the uptick, though prices are expected to increase by just .6% per year. While the allure of cheap property may be tempting, it’s important to recognize that with the state of Greece’s economy property as an investment is still an incredibly risky move.
To enjoy the island life, however, it’s a great time to grab real estate at all-time low prices.
Can foreigners buy property in Greece?
Yes, however it’s easier for some than others. While EU residents will run into almost no restrictions purchasing property on the islands, non-EU residents will need to prove both their connections to the country and their intent for property use. This application is made to the Ministry of National Defense, and mostly involves submission of documents and proof of use intent.
How do I choose the right property?
Property types
The most desired type of property in Greece is villas, however it’s a good idea to remember there are other options that may serve you better or cost less in the long run.
Apartments, for instance, can have sweeping ocean views and beach access, but are significantly cheaper to maintain.
That being said, there’s no type of property you can’t find in Greece- modern homes, historic villas, townhouses, apartments and plots of land are all available, depending on where you look.
Condition of the property
Realistically, buying a home in Greece should come with a lot of caution. Because may properties are historic, they require a lot of rigorous upkeep and plenty of modernizations, but thanks to the failing Greek economy many of those important updates have been pushed aside.
As such, it’s a good idea to bring your own inspector and walk through the house with them, so you can get a real idea of any problems or necessary maintenance. It’s possible to find well-kept, up to date homes on the islands, but it’s always a good idea to do your research.
What are the steps to buying a property as a foreigner?
Buying property in Greece is a pretty straightforward process, even for a foreigner. These are the steps to keep in mind as you get started.
- Choose where to buy. While shopping online can give you a good idea of the property itself, it can be difficult to get a real feel for the area without being there. As such, it’s a good idea to take a trip to Greece to scout where you’d like to buy beforehand, if possible.
- Retain an agent. If you’d rather search yourself, begin looking online
- Pick your property and make an offer. After choosing a property and doing your due diligence, make an offer to the seller. If it’s accepted…
- Get a lawyer. In Greece, it’s mandatory to retain a lawyer if your home will cost more than €12000 in rural areas or €30,000 in urban areas. It’s unlikely that you’ll be purchasing a home for less, so it’s a good idea to take this step up front.
- Get a notary. The notary makes or breaks the property sale in Greece; make sure all your documents are in order so you can breeze through this process.
- Pay your taxes. The buyer pays for the property tax transfer in Greece, which is set at 3% since 2014. Watch out, though- you won’t be able to do so without an AFM, which is like a Greek social security number. You can get one by filling out M1 and M7 tax forms.
- Enjoy your new property!
How do deposits, down payments, mortgages and bank loans work?
Choosing a bank
If you’re looking for a mortgage or home loan, you may struggle to do so; banks in the country have largely halted real estate lending due to the numerous “bad” mortgages they’ve already been saddled with since the market crash.
While it’s technically possible for a foreigner to get a mortgage in Greece, you may be better off working with your local bank for a loan instead. If you’d prefer to try your luck with a Greek bank, you’ll be better off at an institution you’re already banking with. Learn how to open a bank account in Greece to bolster your chances.
Deposits / Down payments
Typically you’ll be asked to pay 10% of the property’s total value to “reserve” it.
What kind of taxes and fees will I need to pay?
As you’re setting your total budget, it’s a good idea to recognize what kinds of fees you’ll need to pay up front. While it’s important to do your own research, these fees are some standard ones to look out for:
- Agency/Agent fees: 1.5-2.5%
- Notary fees: .65-1% + 23% VAT
- Lawyer fees: .40-1% + 23% VAT
- Public Registration fees: .5% + 23% VAT
- Exchange rate: While this varies from bank to bank, it should be based on the mid-market rate.
With that, you’re ready to become a homeowner! Good luck buying property in Greece!