USEFUL INFORMATION
In order to ensure that every detail of the process of acquiring a property in Corfu is understood by our clients, we have compiled a list of frequently asked questions which gives information on the legal procedures associated with the development of a new property, or the renovation of an existing one. Our office can provide help with all these procedures and we work closely with trusted professionals such as lawyers and notaries.
- What legalities are involved in the purchase of a property?
- Do I need a Greek bank account?
- Do I need a residence permit in order to purchase property in Corfu?
- Can non-EU citizens purchase a property in Corfu?
- What does the buying process entail?
- What expenses would I be expected to pay?
- Are there annual property taxes to pay?
- How do I complete the annual tax return?
- How do I prove that I purchased a property with money brought into Greece?
- Is there Council Tax in Greece?
- Can I get help with financing to buy a property?
- What if I want to buy a plot of land and build my own home?
- What happens if I change my mind?
- Can I purchase property in somebody else’s name?
What legalities are involved in the purchase of a property?
Buying a house, or a building plot on Corfu is subject to similar legalities to those applying in most other EU countries.
You will need a lawyer, who will check the title of ownership and ensure that there are no outstanding mortgages or legal encumbrances attached to the property. We can, if requested, recommend an appropriate lawyer.
You will also need to appoint a notary public which is a government-appointed lawyer who processes and certifies all real estate transactions, including drawing up and reviewing all official documents, to ensure the legal transfer of the property and prepares the necessary Final Contract in conjunction with your lawyer. Once the sale has been completed, it is the Notary who registers it with the Land Registry, and retains a copy of the Final Contract. The Notary, will also give you certified copies.
We can also help you find, if needed, a qualified surveyor to assist with enquiries.
You are required to obtain a Greek tax number prior to the final contract being signed.
Via a Power of Attorney, your Lawyer is also able to:
- open a Greek Bank account for you.
- obtain a Greek Tax number.(AFM)
- sign the final contract should you not be able to be present yourself.
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Do I need a Greek Bank Account?
Yes. All necessary payments will be made through this account; also, this account will prove that funds used for property purchase have come into Greece from abroad and are, therefore, not taxable in Greece.
Opening a bank account in Greece only takes a few minutes. Some banks will ask for a minimum opening deposit and you will also need your ID or passport and your AFM (see above).
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Do I need a residence permit in order to purchase property in Corfu?
A residence permit is not required for the purchase of a property in Corfu. You would however need one if you want to purchase a car, moped or any motor vehicle.
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Can non-EU citizens purchase a property in Corfu?
Yes although the procedure differs from that of EU citizens. There are two options and lawyers on Corfu are well versed in the procedures to assist with both:
1 - You can form either an EU registered company in whose name the property becomes registered.
2- Via a lawyer, you can apply to the Greek Ministry of Defence for permission to own/purchase a property.
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What does the buying process entail?
The process is fairly quick and uncomplicated. As a general rule, you must:
- Select your property.
- Appoint your solicitor.
- Appoint a Notary
- Sign a pre-contract (private agreement) detailing terms of sale and payment schedule.
- Apply for your Tax Registry Number (AFM).
- Open a Greek bank account.
- Return to Greece to sign the final contract, after all legal work is completed (6-8 weeks, usually). Alternatively, your solicitor may sign for you if he/she has been granted full Power of Attorney.
- Upon completion of final contract, all fees and taxes must be paid.
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What expenses would I be expected to pay?
Closing costs are estimated at around 13% to15% on top of the purchase price and include:
a. Transfer Tax (Stamp Duty) payable to the Government
b. Notary Public Fees
c. Your lawyers fees
d. Various fees
a) Transfer Tax (Stamp Duty) - The day before signature, the Transfer tax becomes payable to the government.
Please note - this Transfer Tax (stamp duty): is NOT calculated on the actual purchase price, but on the value of the property as assessed by the Tax Office (this is often a lesser amount). Transfer Tax: 8% of the first 15.000 Euros and 10% of the remainder (based on the Tax Office valuation).
b) Notary Public fees: These are between 2.2% and 2.5% depending on the value of the transaction (including subsequent registration fees).
c) Your Lawyer's fees: These are between 1% and 1.5% of the sale price (depending on the value of the transaction).
d) Fees to other persons you might have used. (e.g. a surveyor or an agency)
Please be aware that if you are obtaining a Greek Mortgage, the mortgage arrangement fees are on top of the 13-15% previously mentioned. For further information on mortgages and arrangement fees average please contact us for further information.
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Are there annual property taxes to pay?
There is currently an 'annual property tax' in Greece which depends on the value of the property. As a property owner you will need to complete an annual tax return.
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How do I complete the annual tax return?
You can use the services of an accountant who can submit the appropriate forms on your behalf every year.
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How do I prove that I purchased a property with money brought into Greece?
Your bank will issue you with what is commonly known as a pink slip or other verification that the money for the purchase was brought in from abroad. This verification will be needed in order to complete your tax return.
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Is there Council Tax in Greece?
There is no council tax. There are small charges for community services which include such things as rubbish collection and street lighting. These are added onto to your electricity bill.
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Can I get help with financing to buy a property?
Mortgages can be arranged relatively easily on most properties through a Greek bank. You would be able to raise a maximum of 60% of the market value of the property. There are certain documents you would need to produce, such as proof of income and tax declarations.
Please note that all mortgage applications are subject to bank approval and that their lending guidelines are subject to change without prior notice. In addition, market valuations of the property as performed by the bank's engineer may not entirely correspond with the purchase price and true market value.
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What if I want to buy a plot of land and build my own home?
The planning regulations in Greece are complicated and at the moment subject to a number of changes. In all cases a building permit must be obtained. This is a service we can, being state registered engineers,carry out for. In conjunction with you, we can complete the plans of the proposed house and submit these, together with the other information required, to the building permit office for approval.
We can also make an application on your behalf for connection to the electricity and water supplies. Outside the town, most sewage is dealt with by onsite septic tanks.
Once the building permit is obtained, the normal practice is for you to enter into a fixed price building contract with a constructor to build the house. The process of obtaining the building permit normally takes between 3 and 6 months and depending on the site, the building process itself can then take a further 9 to 15 months.
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What happens if I change my mind?
Signing a pre-contract and paying a deposit for a property, is considered to be an official intent to purchase. It is important that you are absolutely certain that this is the property you want, and that you feel you are under no pressure to sign a contract and pay a deposit. Should you subsequently decide to withdraw from the purchase, you will lose your deposit.
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Can I purchase property in somebody else’s name?
Yes. You may purchase property jointly with your spouse and/or other co-purchasers, in names of children or legal heirs, or in the name of a company.
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Copyright © 2010 [Filippos Kogevinas & Associates]. All rights reserved.
Revised: 07/27/10.
