BUSINESS

Dubious estate agents marring success of Golden Visa scheme

NIKOS ROUSSANOGLOU

TAGS: Property

The performance and the reputation of the “Golden Visa” residence permit program in Greece are being tarnished by the presence of a number of companies that are of doubtful origin and solvency and have been active in the local market over the last couple of years despite lacking the necessary funds. More importantly, they have been linked to illegal activities such as tax evasion and money laundering.

Property market professionals with expertise in the Golden Visa program say that those companies operate outside the boundaries of the law and constitute a serious headache for lawful businesses, as the negative experiences of several investors in Greece has made them turn to other countries instead.

Vaggelis Kteniadis, chairman of property development company V2 Development, tells Kathimerini that “at the moment some 700-800 properties cannot be delivered to their new owners, mostly Chinese, because the agents who have sold them are unable to pay the agreed amounts to the previous owners.” Kathimerini understands that this is because either their bank accounts have been frozen by order of the tax authorities or because they have been under investigation by the authorities for possible money laundering. These companies are estimated to number in the dozens and are mostly of Chinese or Cypriot origin. They were active in other countries, such as Cyprus, Spain and Portugal, before arriving in Greece. They typically approach other companies with the necessary clientele (i.e. interested buyers) and attempt to promote their properties to them.

The problem is that the properties do not belong to those companies, which instead try to obtain them through provisional contracts with the rightful owners as well as sector professionals. In practice, they secure properties with small deposit payments, but as many of them are under investigation by the tax authorities, they are unable to assume full ownership despite having already cashed in significant deposits by prospective buyers.

The method of provisional contracts, real estate professionals note, has removed a significant amount of residential properties from the stock of supply, distorting the market. The phenomenon has been growing in areas of high interest for foreign buyers, such as the center of Athens and the southern suburbs of the capital, inflating prices too.

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