The Steps to Buying in Greece
Let’s start by understanding the journey of buying a house in Greece. Without being very different from other European countries, buying real estate in Greece has some small particularities:
- Search for the property: Nothing surprising, we always start with the search! The easiest way, and especially if you are abroad, is to use real estate platforms such as Green acres which list many ads from different agencies to find properties for sale. If you are short on time or are not very comfortable with the Greek market, you can also hire a house hunter.
- Obtain an AFM number (Greek tax number): This number is essential to carry out any financial transaction in Greece and will be necessary throughout the purchase process.
- Hire a lawyer specializing in real estate law: Unlike northern European countries such as France, The notary has only a very limited role in the real estate transaction. It is therefore essential to hire a specialized lawyer in order to check the ownership documents, ensure that there are no debts attached to the property, and guarantee that the transaction is secure. Remember that until 2018, there was no land registry in Greece. In order to avoid unpleasant surprises, we insist on the importance of hiring a local lawyer!
- Signing a reservation contract: Once you have chosen the property, you can sign a reservation contract. This gives your lawyer time to complete all the necessary checks on the property before finalizing the purchase.
- Promise of Sale Contract: This contract is binding on both parties and requires a down payment, usually between 5% and 10% of the purchase price.
- Deed of sale: The finalization of the purchase is done before a notary, with the payment of the balance and the handing over of the keys.
- Property Registration: In Greece, your new property must be registered with the Land Registry Office to ensure legal recognition of your purchase. This recording has a cost, which is important to take into account in your budget!
- Consider additional costs: Allow about 8-10% of the total purchase price to cover property transfer taxes, notary, lawyer and real estate agent fees.
Procedures and Regulations for Buying in Greece
Getting an AFM Number
The Tax Identification Number (AFM) is a must for any financial transaction in Greece, including the purchase of real estate and the opening of a bank account. You can obtain an AFM from a Greek tax office or through a legal representative if you are not yet a resident. This number will allow you to carry out essential administrative procedures to carry out your investment project.
Open a bank account
Opening a bank account in Greece is a crucial step in managing your real estate transactions and finances. To do this, you will need the following documents:
- A passport or ID card,
- Proof of residency (local or in your home country),
- Your AFM number.
Most of the major Greek banks, such as Alpha Bank or National Bank of Greece, offer foreigner-friendly services and make it easier to open an account.
Getting a mortgage
Getting a mortgage to buy a property in Greece is not impossible, but it can be very complicated, especially if you are not a resident. Greek banks, if they accept, have fairly strict lending criteria, especially for foreign buyers. In general, financial institutions require a personal contribution of around 30 to 40% of the total purchase price. To maximize your chances of obtaining a loan, it is recommended that you prepare a solid file including your proof of income, bank statements, and proof of creditworthiness. It is also a good idea to use a credit broker who knows the Greek market well and can direct you to the banks that are best suited to your profile. Finally, if you have a good credit history in your home country, this can work in your favor when negotiating with Greek banks.
Read our article on mortgage in Greece
Additional costs
As we mentioned earlier, buying a house in Greece involves many costs that are not very visible at first:
- Travel expenses: if you don’t live in Greece, remember to include the costs of your travel in your budget.
- The TAP is the famous property transfer tax. It is calculated by the notary according to the value of the property.
- Lawyer’s fees are equivalent to 2%, calculated on the value of the property.
- Notary fees because yes, even if the notary plays a small role, he also has fees that go up to an average rate of 1% to 2% of the price of the property.
- The real estate agency’s fees correspond on average to 2% to 3% of the value of the property.
Taxes and inheritance
Tax treaties between France and Greece
France and Greece have signed a tax treaty aimed at avoiding double taxation of French residents who own real estate in Greece. This agreement is designed to prevent income generated by your property in Greece, such as rents or capital gains in the event of a sale, from being taxed twice: once in Greece and once in France. In general, taxes are paid in priority in the country where the property is located (Greece) and tax credit mechanisms make it possible to neutralize taxation in France. However, it is important to consult with a tax expert to fully understand the implications of this treaty and ensure that you meet your tax obligations in both countries. This will allow you to avoid any surprises and fully benefit from the benefits of real estate investment in Greece.
Property tax in Greece
As the owner of a property in Greece, you will have to pay the annual property tax, called « ENFIA » (Immovable Property Tax). This tax is calculated according to various factors such as the cadastral value of the property, its location, the living area, and the age of the building. Rates typically range from 0.1% to 1.15% of the appraised value of the property. If you own several properties in Greece, you will also have to pay an additional tax depending on the total value of your real estate assets. It is important to be well informed about these tax obligations before purchasing and to plan for these costs in your annual budget to avoid any unpleasant surprises.
Read our article on real estate taxation in Greece
Inheritance and inheritance
In Greece, it is important to plan the transfer of your real estate, especially if you are a foreigner. Although Greece has an inheritance tax system, direct heirs (children, spouses, parents) are often exempt from certain taxes, including inheritance tax. It is possible to draw up a will that specifies that the inheritance law of your home country applies, thus providing more flexibility in the management of your assets.
Read our article on inheritance in Greece
The Golden Visa
The Greek Golden Visa is a particularly attractive option for foreign investors. This program allows you to obtain a residence permit in exchange for a real estate investment of at least €250,000. It offers many advantages, including the right to travel freely within the Schengen area and to open up prospects for permanent residency after a few years.
Read our article on the Golden Visa in Greece
Pitfalls to avoid
Buying a house in Greece can be a very interesting investment, but it is essential to know the potential pitfalls to avoid unpleasant surprises. Between title deed issues, hidden fees, local taxes, or building restrictions, it’s important to be extra careful when buying!
Check out our article on the subject, and don’t hesitate to call on a lawyer to avoid any unpleasant surprises! A careful and well-informed approach is the key to a successful real estate purchase.
Conclusion
Investing in Greece offers a unique combination of quality of life, tourism potential and economic stability. Whether you are looking for a second home, a rental investment or a place to prepare for your retirement, Greece offers an ideal setting to make your plans a reality. By following local procedures and complying with regulations, you can safely invest in this beautiful Mediterranean country. Don’t hesitate to consult local professionals to support you every step of the way and maximize your success in Greece.
