Crete Properties Buying Guide

The process of buying properties in Crete, Greece has its complications, the lack of an established land registry makes checking the legal ownership of a property a tricky business, but Greek solicitors are experienced in making the necessary checks and providing you acquire the services of a good solicitor, the process should be straightforward and should only take six to eight weeks.

Owning a property in Greece is simple; there are no restrictions on who can purchase property and residence permits are only needed if you’re buying a property close to a border. Keep an eye on this – this rule applies to Rhodes and some of the other eastern Aegean islands as well as the mainland. If you intend to buy near a border, obtain a ‘Blue Card’ temporary permit from the local police station.

Before you find a property:

Make sure you have a Greek bank account set up. This is easy to do and you only need proof of identity and proof of your permanent address. In Greece, solicitors do not hold any monies for you, so transfers will need to come from your account. Grecian authorities are very concerned about where a foreign national is obtaining money to purchase property in Greece. As a consequence, a person from another country interested in buying property in Greece will need to obtain what is known as a "pink slip" for wire transfers of money from abroad. The purchaser has to be able to demonstrate where the money is coming from and if he or she cannot, Grecian governmental authorities will consider any money wired into the country as income and will tax it accordingly Also before anyone can purchase real estate in Greece, that person must first obtain a tax role number, known in Greece as AFM. This number is easy to get and can be obtained at any tax office in the country. You can give your solicitor power of attorney to obtain this for you. 
You might also want to obtain a mortgage before you start looking for your property to avoid any disappointments. Greek Banks, such as Piraeus Bank UK, offer mortgages to Greeks and overseas buyers. The banks will carry out the usual credit checks, but you can expect to borrow 70-80 per cent of the value of the property over 15 to 25 years and pay in monthly installments in euros.

Reasons for Looking for a property

Before starting your search, work out what it is you want from the property. Are you looking for a high rental yield, or are you looking for a family home? What amenities do you need nearby and how often do you intend to visit.

Found your property

It is usual to place a nominal deposit to prevent the seller from continuing to market the property. This is usually around €3,000, but it can be as much as 10 per cent and is deducted from the total amount due at the end of the sale. If you pull out of the sale without good reason, your deposit is not returnable.. If your seller changes his mind without good reason, you will receive double your deposit back. If you’re forced to pull out because of a legal issue, your deposit will also be returned.

Solicitor

You must select a different solicitor to your seller. Your solicitor will obtain the seller’s title deeds and ensure the property is free from encumbrances. He will check planning permissions are in order and investigate the history of the property. You might want to give your solicitor power of attorney to act on your behalf if you plan to leave Greece during the buying process, otherwise you will need to return every time your signature is required.

The Notary Public

Your solicitor will liaise with your seller’s solicitor to agree a Notary Public for the sale. This public servant acts on behalf of the state to witness the execution of the deal and those that take place without a Notary Public are not deemed legal.

Signing

When your solicitor has completed his enquiries and is satisfied that the seller is the legal owner and the property purchase is in order, you must sign the purchase documentation in front of the Notary Public... If you’ve granted your solicitor power of attorney, he or she can do this for you. The Notary will then register the transaction on the public record.

Registration

The contract deed must now be transferred into your name at the Register of Mortgages and, if the property is listed with the land registry, a copy of this certificate with the contract deed must also be submitted to the land registry.

Tax Return

All property owners in Greece are obliged to complete an annual tax return, which must be prepared by a local qualified tax accountant. This is straightforward and inexpensive. If you’re property’s tax assessed value exceeds €243,600 you will be required to pay an annual property tax.

Buying Property in Crete

Buying property in Crete is a relatively straight forward procedure. The steps that need to be followed are quite basic and are outlined below.

Appoint A Greek Lawyer
In Greece the buyer must have his own independent lawyer based in Crete who will assist him during the house purchase procedure and represent him in all legal matters pertaining to the purchase of his house in Crete. To this end it is recommended that the buyer gives Power of Attorney to his chosen lawyer enabling him to act on his behalf when the purchaser is not himself in Crete. If the buyer doesn't know a local lawyer Action Constructing can recommend a selection of reputable lawyers who have experience in matters of real estate conveyancing in Crete and are fluent in foreign languages.

Appoint A Greek Public Notary
In order for a property purchase agreement to be valid here in Crete a public notary must be appointed. The public notary drafts the official purchase contract and it must then be read, understood and signed in his or her presence by the buyer and seller or their legal representatives. The public notary does not represent the interests of the Buyer as this is the role of the buyer's lawyer, but the notary public is responsible for the verification and registration of the purchase transaction in the public records, known as the Registry Of Mortgages, so that the buyer acquires the official title deed of the property. Action Constructing can either recommend a number of notaries for the buyer to select or immediately assign the one responsible for the drafting of the official purchase contracts of a specific project subject to the buyer's approval.

Property Title Deeds In Crete
Title deeds of ownership in Crete are held at the Registry of Mortgages. The vendor must supply the buyer with a copy of the title deeds of the property in question. This is often done with the help of the buyer's lawyer who is then obliged to investigate the title deed to ensure that:

• The vendor holds the absolute deed of the property 

• There are no claims against the property or encumbrances 

• The vendor has paid his property tax 

• The property was built strictly according to planning and building permissions 

Only if the title deed is found to be clear will the buyer's lawyer recommend that he proceed with signing of the official purchase contract.

Greek Tax Role Registry No. (ΑΦM) 
A tax role registry number (pronounced "a-fee-mee") must be issued for the buyer to be able to proceed with any transaction including the buying of a house in Crete. The tax role number can be applied for by the buyer's lawyer in their absence as long as the lawyer has power of attorney for their client. The tax role number is issued by the Inland Revenue.

Transfer Tax in Greece
The previous tiered transfer tax paid by anyone buying property in Crete has been replaced by a VAT payment of 19% of the value of the property. NOTE the prices on this website include the VAT payment.

Transfer Of Title Deeds At The Registry Of Mortgages
The buyer's attorney makes sure that the title deed is transferred to the buyer's name by obtaining the relevant certificate from the Registry of Mortgages.

Opening A Bank Account In Crete
Greek banks offer a wide variety of financial services. It is advisable for the buyer to open a bank account with one of the major banks here in Crete. This can be done with the help of the buyer's lawyer. Subsequently money for the property purchase can be transferred from abroad into this bank account. Withdrawals from the bank account can be made by the buyer's lawyer on the buyer's order. Cretan banks issue "pink slips" for funds that originate from abroad. These pink slips must be requested from the bank by the buyer or his Greek attorney and allow him to prove that the property has been paid for using money transferred from abroad and not earned here in Crete. The pink slips are essential for the buyer's yearly tax declaration and should cover the "assessed value" of the property (see below for details).

Crete Property Insurance 
Property in Crete can be insured through insurance companies. Property insurance contracts cover all types of possible damages i.e. fires, earthquakes, natural disasters, storms, theft, third party liability etc. Insurance costs are normally billed bi-annually though annual payments are also acceptable. Property insurance is not obligatory, but if you have taken a mortgage for your home in Crete from a local bank they normally require that you use an insurance company stipulated by them for your Crete property insurance.

Yearly Costs Related To Your Property In Crete 
Yearly property taxation in Greece is limited to the following:
1. Local municipal tax:
The council tax ranges from 0,025% - 0,035% on the "assessed value" of the property and is incorporated in the electricity bill. 
2. Yearly property tax:
Owners of property pay a yearly property tax only if the "assessed value" of their ownership exceeds the amount of 243.000 €. The amounts are between 0,3% - 0,8% of the assessed rate of the property. 

"Assessed or Objective Value" Of The Property 
The "assessed" or "objective" value of a property is the minimum accepted value of the property in Crete for transaction and tax purposes. The assessed value is calculated by the Public Notary and the Inland Revenue Service for each individual pr.operty and the calculations are based on public data supplied by the state relating to prices per square meter as well as other location or specific property characteristics. Assessed values, as mentioned above, are used for the yearly tax declaration.

Security Of Property In Greece 
The ownership of property in Greece is secured by the state authority called the Registry of Mortgages. Titles to your property are kept there, where all encumbrances on properties are stored. Property is filed under the names of the owners and lawyers are entitled to check the property belonging to any individual or company. A title search is performed in order to find out if there are any claims, bonds or encumbrances on the property. A title search will also show you if the property was properly transferred