When you have found your ideal property and are sure you want to go ahead, your lawyer will prepare the preliminary sales agreement. This covers the basic terms of the deal such as the price, what is included, who are the buyers and sellers, the payment method and the date for completion.
It is important that the agreement lists any particular reasons why the buyer or seller may pull out without losing a deposit, for example if there is a problem over the building licence, or if the sale is contingent on mortgage approval. If not, if the buyer pulls out of the deal in breach of the agreement they will lose their deposit. If the seller tries to pull out, however, she could lose double the deposit.
In the time (usually four to six weeks) between signing the sales agreement and completion, searches are conducted by your lawyer. These will ensure that: the property is the seller’s to sell and has a clean title, that there are no debts on the property and that it complies with all planning laws and permissions.
Your lawyer is unlikely to visit the property himself so it will be up to the buyer to ensure that what is in the building licence matches what is at the site. Check there is no illegal swimming pool or extension, or a veranda closed in to create an additional room. If there are illegal parts of the building discovered later then the new owner may be fined.
By this time you will have engaged a public notary who will prepare the final deed. The buyer will normally attend the signing of the deed in person, at the notary’s office, along with lawyers from both sides and the seller. You don’t have to attend the signing of the final deed; you can assign power of attorney to your lawyer. The balance of the sale price will be transferred along with the notary’s fees, estate agent fees and all taxes. Keys are transferred and the property is yours.
For resale property you should allow for 10 per cent on top of the purchase price. This is made up of 3 per cent property tax (recently reduced from 8-10 per cent), 2 per cent to the notary and land registry, 1 per cent to your lawyer, and 2-2.5 per cent to the estate agent. All professional fees are subject to 23 per cent VAT. When you sell you also pay 1-2.5 per cent to the agent.
There are also plans to introduce capital gains tax from 1 January 2017. In Greece’s fast moving political and economic situation, costs may vary. The Government, caught between raising money and encouraging commerce, often changes tax rates.
Indeed buying costs for resales were reduced from around 13-14 per cent between 2014 and 2015, while the VAT rate has been raised for new builds. Buying costs also vary according to such factors as the date of construction or the location of the property. Buying costs tend to be higher in percentage terms for the cheaper properties.