There is a huge choice of properties that are good value for money. However, the most populated areas of Greece, for example Athens, the neighboring Peloponnese and the larger islands like Crete tend to be more expensive due to the high demand pushing up prices. Having said this the supply is plentiful and there are still bargains to be found and when compared to prices in the UK yield better value for money. The cheapest properties are to be found in the rural areas of the mainland.
There you can find properties like a large farmhouse for the same price that you would pay for a small apartment in a popular resort like Mykonos or Santorini. However, you must carefully consider what you want from such a location.. If you buy a property on the rural mainland you must enjoy walking and the country life. You must consider what it would be like in winter. Often a car is essential for shopping and sightseeing and also, if you don’t have a pool, for visits to the nearest coast for swimming.
As you would expect from a capital city, Athens is expensive although apartments can still be obtained more cheaply than in, for example, London. On the islands it is still possible to buy old stone houses in need of restoration for around 20,000 pounds sterling but new-builds would range between perhaps 40,000 for a 1 bed roomed apartment to 150,00 for a 4 bed apartment – and obviously this depends upon the island and its location on that island. Sea views, panoramic views and convenient locations tend to be more expensive than inland rural areas – as is the case anywhere! The cost of land follows the same rules and also if you are considering purchasing a plot of land to build upon you need to consider the availability of labour and resources and the cost of this.
How do the locals react to foreigners buying properties in Greece
Generally speaking Greek people are warm and friendly and the concept of filoxenia is happily alive and well. Families tend to build for themselves and do not buy and sell as frequently as in other countries in an effort to climb the property ladder, which means there are plenty of properties to modernize or land on which to build. Additionally, there are no state handouts or accommodation granted for those who are homeless or unemployed, which means no resentment at state funds being allocated to non-Greek persons. In the villages most people are happy the older properties are being renovated and brought back to life.
Restrictions and pitfalls when buying plots of land in Greece
You would not dream of buying a piece of land from a guy you met in the pub and then having your local restaurant owner’s brother build you a house. so before you hand over money to the chap in the tavern who has a piece of land to sell you and whose cousin can build you a house very cheaply, be aware that buying land can have pitfalls and it is essential that you check the following. Laws regarding building outside village/town limits, change al the time and what is the law in one area of Greece may not be applicable in another part. Some areas in Greece already have a law stipulating that the plot size must be over 4,000m2. Permission, however can be granted for plots of 2,000 m2 or less if they come within the planning zone or they have frontage to a principle municipal road. If a plot does fall within the town plan then density can be increased by as much as 70%. For example in Crete, outside town and village limits you need a minimum 4000m2 upon which to build a house of up to 2000m2. There are certain exceptions, for instance if the plot is within a 500 meter radius of a town/village center, or on an officially existing road the requirement can be 750m2 – 3,999m2. So you can see that it needs careful investigation of the regional laws and the local by-laws. When buying a plot, it is vital to know the following: where the plot is located; how big it is – for this, ensure you have a signed topographic survey and are not relying on rumors or verbal information and finally, the date of the creation of the specific plot of land, so the date that it legally started to exist as an independent property.
VAT system in Greece on self build properties
The VAT system in Greece a bit different from some countries of the European Union. At the end of the building project, you will need to apply to your local Greek tax office and prove that you have paid the 18% VAT. Unlike other EU countries where private individuals can reclaim VAT on properties they have built themselves, only registered companies can reclaim the VAT in Greece.
Purchase tax starts at 7% of the assessed value. Notary Public fees and legal fees are based on the assessed tax value of the property not purchase price. therefore if you are buying in a non-touristic area the assessed tax is likely to be lower than the actual price paid. to cover all these extra charges you should add between 10-15% to the purchase price. Using the services of an English speaking solicitor is essential. Many books and internet sites exist which are a valuable source of information that covers both property adverts and relevant Greek legislation. You don’t have to be a resident in Greece to buy a property, you only need to hold an EU passport. The procedures from finding to owning can vary in time considerably. If the property is “clear” i.e. there are no disputes over ownership of part of the land and/or property and if the property is not owned by several people in a family and thee is agreement to sell at the agreed price then it can be very quick, perhaps 2 weeks.
Finding a Builder in Greece
If you are getting a lot of work done – get several quotes. If not so much work 1 quote should be enough. If you obtain 2 quote that are widely different then get a 3rd one. However, you should bear in mind that quotes may be calculated differently.
Generally local builders are preferable but those with good reputations may be difficult to find, especially if you don’t speak Greek. however, word of mouth is very strong in Greece and you can ask to see previous work carried out by the local builder to assess the quality. You may find that other English people have used a local builder they are happy with. Its pretty easy to find out if a local builder has a bad reputation.
Trading Standards Agencies – individual local builders in a village are unlikely to be members of Government or other organisations.
As for the building, employ an experienced qualified architect to work with you on the design of the property and to draw up the plans and submit them to the relevant authority for a Building Permit. Obviously it helps to be able to converse with the architect, so aim for one that speaks English to avoid future problems. The Building permit takes two to four months from application to Permit in hand.
Make sure everything is written down into a contract between you and the architect/builder/contractor. The contract should include a clause relating to the length of building time and details on stage payments. Also it is your responsibility to ensure all VAT and IKA (workers national insurance) payments are correctly paid.
On a new build, IKA is worked out by the architect and checked by the IKA authority when presenting the file to it in relation to your building permit, that is, the size of the property and what work needs to be done, internally and externally. Everything is finally cross-checked by IKA with an onsite control, which can be made any time during the work and when work is completed. You will receive a monthly receipt for the IKA you, your architect, or whoever has your power of attorney to do this, is paying on your behalf every month. This receipt is issued only once payment has been made. The final IKA certificate is necessary for the final connection to the electricity mains. Also, in the future, if you need to sell your house, the final IKA certificate must be produced. It is important to realize that, in the end, it is only you as the owner of the land, who has the ultimate responsibility for ensuring that all the IKA is paid. Even if you do some of the work yourselves, you must still pay the IKA that the state would lose if you were employing someone to do this work for you. so you must declare whatever works you do to the IKA authority and pay the necessary contributions. You must get advice from your architect on this as you risk facing very high fines if a representative carries out a check on the completed or works in progress and finds that no IKA has been paid.
renovation and restoration of property in Greece
There are many old properties that need renovating but make sure you use a local architect and have contacts who speak Greek and understand all the property laws in Greece.
If you decide to buy a traditional small, stone house – which can often be picked up at very reasonable prices, you need also to include in your budget a considerable chunk for its restoration.
also don’t expect a huge resell price if you decide to sell after renovation. Locals in particular are not especially interested in old restored properties.
Renovating houses often take more money than planned for and take much longer than anticipated. Agents will oversee renovations. Building work can be much slower than anticipated and completion could be 6-12 months behind – or even longer!
A problem that you may encounter when buying older properties is the tangled web of ownership. Houses are passed down through families and it is not uncommon to find that a property you are interested in is divided up into several owners – some who may merely own outbuildings, trees on the land or a few rooms in the main house. All these owners have to be involved when contracts are drawn up and all have to agree. You must never handover any money until all the paperwork has been seen and understood.
Make sure you have all renovation plans and deadlines in writing. don’t be too informal and include penalties in things that go over the deadline.
Be prepared for your plan to take a time. If you are having to build expect to live in rented accommodation for a few months maybe even for a year.
Explore local building materials.
WHAT PERMITS NEED TO BE OBTAINED BEFORE RENOVATION BEGINS – WHO SHOULD WE ASK
A competent architect is more of an expert in this than a lawyer. Firstly make sure legally that the size of the plot has the potential to take a larger sized property, if you are thinking of enlarging. the architect will also be able to tell you whether or not you must have a building permit to carry out the work you want to do
IKA – Additionally, you will probably have to declare the work you are going to carry out to the IKA authorities. this is a very powerful state department. If you employ legal workers, such as roofers, plasterers, tilers, etc. you are not only paying them but also their national insurance stamp (IKA). Even if you do the work yourself you must still pay IKA a percentage of the amount they would have received. If you do not declare the works you have done and you need to sell the property, you will face problems and have to pay in retrospect, which will be more expensive. Also while work is being carried out on the property you risk high fines if an IKA representative does a spot check and you have no IKA papers relating to the property.
BUILDING AND RESTORATION ISSUES
A lot of the materials for the restoration may need to be carried on to the site by donkeys or mules due to the existence of steps or poor roads. also the materials may need to be shipped in from larger islands or the mainland if the locality of your property is very remote.