Rhodes: Greek investment incentives fuel property price rises

Tuesday, March 25, 2014

Rhodes: Greek investment incentives fuel property price rises

The market for quality holiday properties in Rhodes is currently undergoing a period of growth - partly due to a drop in land tax and the introduction of residency permits.

After considerable fluctuations on the Greek property market resulting from the Euro crisis, agent Engel & Völkers has been registering a continuous rise in enquiries for prestigious residential property since 2013.

They report that the high level of demand is sending prices soaring contrasts with the lower end of the market where there are still hefty price reductions available.

Rhodes, the largest of the Dodecanese Islands, is a mix of lively resorts, great beaches, wooded valleys and ancient cities. Picturesque Lindos, with its sugarcube houses tumbling down to a turquoise sea, is a highlight.

Engel & Völkers attributes this Greek market development, amongst other factors, to general worldwide uncertainty resulting from the instability of stock markets and many people's wish to invest in stable tangible assets as a result.

Land tax down from 10 to 3 per cent

The reduction of land transfer tax from 10 to 3 per cent, which came into force on 1 January 2014, favours this trend.

"We have registered a 30 per cent rise in the number of search customers for exclusive homes in desirable locations," reports Georg Petras, Managing Partner of Engel & Völkers Rhodes.

Availability of premium property on the sunshine isle is limited however.

The market for residential homes on Rhodes continues to be impacted by a low number of new building developments, and the limited number of existing prestigious properties in good and very good locations, due to the natural limitations of Rhodes being an island.

Buyers of holiday homes and luxury property are usually wealthy foreigners or Greeks living abroad who, in many cases, acquire their property with little or no borrowed capital at all.

So where are all these buyers from?

The majority international buyers currently dominating the market originate from Germany, the UK, Austria, Switzerland, Belgium and non-EU states.

Golden visas

Non-EU citizens buying a property worth €250,000 euros or more now receive a five-year residency permit that can be extended as many times as they wish.

This has not been widely publicized - as in the case of equivalents in Spain, Portugal and Cyprus - and is only beginning to filter through to agents and buyers.

Engel & Volkers expect a rise in demand, especially from buyers based in the Middle East and Russia.

"Real estate in Greece is a good investment prospect once again as the bottom of the market in terms of property prices has passed and buyers are now being rewarded with high potential for appreciation in the value of their new homes," said Mr. Petras.

Hotspots

The most sought-after locations for second homes are Lindos and the surrounding region with the resorts of Pefkos and Vlicha, as well as the entire east coast stretching down to the south.

Most desirable are prestigious properties on the coast with direct access to the sea or a magnificent outlook.

There is particularly high interest in villas, attractively positioned houses of all sizes, traditional captain's cottages, as well as townhouses and penthouse apartments.

Large houses in the most demand

Generally speaking, larger houses with three of more bedrooms and top-quality fittings are in most on trend at present.

The 230m2 five-bed finca pictured is €1.5m through Engel & Volkers.

But you can also buy apartments from around £125k, or three-bed villas from around £150k-200k - search here.

Or browse properties for sale in wider Greece.

A Place In The Sun