Frequently Asked Questions (FAQ)

Do I need an attorney? If yes, why?
Yes, you will need an attorney. Appointment of an attorney by the buyer is mandatory in order to carry out the transaction. The procedures undertaken by the attorney are vital to the transaction as they include legal survey, and property title search to ensure that the property is free any mortgages, liens, claims, expropriations, rights-of-way, easements, unpaid property taxes by the seller, or anything else that would in any way legally encumber the property.

Do I need a notary? Hoe does he figure in the transaction?
Yes, you will definitely need a notary. Notary Publics are state-licensed attorneys solely authorized to process and certify all contractual transactions. In a real estate transaction the notary draws the contract, reviews and certifies all official documents, and ensures the legal transfer of the property title. It is mandatory to have the purchase contract drawn by a notary and signed in his presence.

Do I need a land surveyor as well?
Yes. Surveyors ensure that every aspect of the property construction has been carried out in accordance to the law and the issued permits.

Do I need an accountant?
Yes, and it would be wise to hire one early on. Besides assisting with your tax returns and explaining taxation regulations, an accountant will assist you with any number of issues – from establishing a company to employment issues.

Do I need a Greek bank account?
Yes, in order to transfer funds and make payments. Having a Greek bank account provides proof that the funds used for the purchase have been transferred to Greece from abroad and therefore are not subject to taxation as income. The process of opening a bank account in Greece is easy: all you have to do is walk in to the bank with an ID card or passport and a Tax Registry Number (AFM). There is no minimum opening deposit requirement.

Do I need a Tax Registry Number (AFM)?
Yes, you most certainly do. The AFM is mandatory for all transactions in Greece and all buyers, including foreigners and permanent residents abroad, must have one. . It is issued on the spot at local tax offices, free of charge. All the tax office requires to issue an AFM is your passport, although some tax offices may request a birth certificate as well. An attorney or any third party authorized through a Power of Attorney may also apply for the AFM on your behalf.

Do I need to have a residence permit in order to purchase property in Greece?

EU nationals

A resident permit is not usually requested by authorities for EU nationals. It will be necessary to have one if you wish to import your car to Greece or purchase one locally.
Non-EU nationals

Yes, if you plan to purchase property in a region near national borders or some islands such as Rhodes, and islands of the Eastern Aegean. In addition to the residence permit, you will also have to apply for a special permit issued by the Ministry of Defense in Athens.

List of documents necessary for buying property in border areas and other restricted regions.
An alternate and more efficient way to purchase property in these areas is through an offshore company in your name, based in an EU country. This is fairly commonplace; setting up and maintaining such a company costs approximately 2,000 euros to establish and 1,500-2,000 euros annually. To purchase property in all other regions of Greece, you do not need a residence permit.

Do I need to make a deposit in order to secure the property?

A 10% down payment is required in order to show and secure interest, and have the property taken off the market. Deposits and partial payments vary on a case-by-case basis if you are buying off-plan or a property under construction.

Do I have to be present at the signing of the contract?

No. Most people of course would not miss this occasion, but legally speaking you do not have to be there. You do however have to authorize someone through a Power of Attorney, to act in your behalf – namely, sign the contract. If you are not in Kefalonia at the time of the contract signing, your attorney is the most likely candidate for signing the contract in your place.

Do I have to file tax returns in Greece once I've become a property owner?

Yes. It is mandatory that all property in Greece be declared to the tax authorities on a form E9. This obligation applies to every property owner in Greece, even for those who live abroad and have never filed tax returns in Greece or do not have an income in Greece. The E9 is not filed alone; it is submitted along with the basic income tax form E1. If you have no income in Greece, you enter “zero” income in the E1 form – which still has to be submitted even with zero reported income.

Do I have to pay annual property taxes?

Property tax is determined by the value of the property. If your property’s “objective” (tax assessed) value exceeds 243.600 euros, then it is subject to property tax.

Do I have to pay Capital Gains tax if I decide to sell my property?

The new property taxation laws which went into effect on January 1st, 2006 include a provision for a Capital Gains Tax on properties purchased on or after that date. The tax is scaled depending on the number of years a property remains in your ownership before reselling. The longer this period, the lower the tax and vice versa.

Do I need a license in order to rent my property (house, villa, or apartment)?

Yes. This is a significant issue for many people buying property in Kefalonia as they want to be able to rent it when they are abroad. To rent holiday property you must have a valid permit.

Can I purchase property in somebody else's name?

Yes. Property can be purchased jointly with your spouse and/or other co-purchasers, in the names of children or legal heirs, or in the name of a company. You may even form a company – usually a limited liability one – solely for the purpose of buying property under the company’s name.

Can I get a mortgage in Greece? If so, what are the requirements?

Yes, you can get a mortgage in Greece. The documents necessary when you apply for a mortgage include your passport and proof of income for the last 3 years (e.g. P-60's, salary or wage stubs, tax returns if self-employed). Please note that banks in Greece require that you have paid in full all closing costs before they release any funds.

Can I renovate or build on my own?

Yes you can. You have to be aware however that major renovations and new construction require building permits from proper authorities. In addition, only state registered professionals are allowed to undertake certain work, or sign and certify your work. The National Insurance Authority (IKA) calculates a minimum number of wage-days for which you’ll have to pay an amount to this fund, regardless of whether you are doing the work yourself or engaging others to do it. Another obstacle to undertaking major construction work yourself is the language, as most construction tradesmen and workers speak only Greek.

Can I work or open a business in Kefalonia (Greece)?

All European Union citizens have the right to live and work in Greece. To work in Greece, you will need a residence permit which also serves as a work permit. Issuance of the permit at the police station is relatively easy and inexpensive. The establishment of a business does require some formalities, and you’d be well advised to hire an attorney and an accountant to see you through the process.

Can I bring my car to Greece?

It depends. If you plan to live in Greece, you may import your car into the country, tax free, and acquire special Greek number license plates. There is some paper work involved for this process which should be initiated before you enter the country by contacting the Greek Embassy in your country of origin. If you are going to be living in Greece part of the year, you can bring the car into the country for a 6 month period each year. When the 6 months are up, you must take the car out of Greece.

What is a property's Objective Tax Value?

It is an assessed value determined by Greek tax authorities which is based on a number of factors including location, age of the property etc. The objective values are subject to periodical revision and are used for determining taxes payable on property transfers, inheritance taxes, etc. The objective value is usually significantly lower than the market value.

What happens if the title search uncovers any problems with the property?

In this case, you will get your deposit back in full. This is why the deposit is held by the attorney and not the seller in the first place.

What happens if I change my mind about the purchase?

A pre-contract along with a deposit are deemed as official intent to purchase. Should you withdraw from the transaction, you will lose your deposit. Therefore, it is very important to be absolutely certain that this is the property you want to buy before you make this commitment. The decision should be carefully weighed and should not be made under pressure.

What happens if the seller changes his mind about selling the property?

If you have signed the pre-contract and made an initial deposit, your deposit will be refunded in double.

What type of property insurance do you recommended?

There is no standard insurance package, although the rule of thumb is that property should be protected against certain risks, including: fire, earthquake, water damage, breaking glass, storm, theft, and third party liability.

Where in Greece should I buy property?

Not an easy question to answer because the choice is virtually unlimited. Islands are a prime choice for buying real estate property – and one cannot complain that Greece is in a shortage of islands! Prices and living conditions do, of course, differ from place to place. Coastal properties can be more expensive than inland based properties, so it may be wise to buy an inland property which is still never too far away from the sea to enjoy it. As far as the mainland is concerned, many regions are a bit more expensive than the islands, with the greater Athens are topping the list.

How do I transfer funds to purchase the property?

All you have to do is to open an account with a local bank, something that can be accomplished in a few minutes. All you need is your passport and a Tax Registry Number (AFM). There is no minimum initial deposit requirement. We can recommend a bank or branch with established reputation and experience in handling g foreign customers.

How long will it take to complete the purchase transaction once I have chosen a property?

There are no unreasonable delays if all the documents are in proper order. Some transactions can be completed within 3 weeks, although most transactions are finalized between 4-6 weeks. Of course, it could take a lot longer – as much as 6 weeks – 3 months. In this case, if all documents are in order, it would be wise to become a bit more persistent – it works wonders!

How much extra money will I need to peripheral cover costs involved with the purchase?

All purchase related expenses – including legal expenses, notary, court fees, deeds, registry, taxes, and commissions – usually come to 13 % of the purchase price. This is pretty much a ceiling figure and depending on the agreements you’ve made, it could be lowered a bit.

What is the proper procedure for transferring the funds for payment?

The most important thing to be aware of is that the transfer of funds through a bank to your local account and its declaration as being intended for the purchase of property, are crucial for tax and repatriation reason. Individuals originating in countries outside the Euro-zone should have the currency converted to Euros in Greece. To avoid any problems created by revisions to tax regulations, please consult us before transferring the funds.

What is the difference between building within or outside of the city or village limits?

Building within the delineated limits means that you may build on a smaller plot. The infrastructures are in place and you only incur the expenses of small connection fees to utilities such as water and electricity.
Building outside city or village limits, means that you are required to have a minimum of 4.000m², (with a few exceptions.)
Due to the lack of infrastructures in the countryside, you will incur greater costs to sort of bring the infrastructures to your doorstep. This can be quite expensive - and often not problem free - depending on the location.

Athens Office: 78 Marathon Street 16673 Panorama, Voula
Tel & Fax: (0030) 210 89 95 499, Mobile: (0030) 6944 344 683, (0030) 6977 090 163
Kefalonia Office: Mavrata Village 28082, Tel & Fax: (0030) 26710 81618, E-mail: divacasa@hol.gr