REAL ESTATE

Property buyers in a rush

Realty transactions accelerate ahead of new objective values starting in January 2022

property-buyers-in-a-rush

The new property rates used for tax purposes – known as “objective values” – as well as an earlier deadline for the payment of the Single Property Tax (ENFIA) will go into effect in just six months’ time, affecting activity in the Greek real estate market.

With the countdown having started for the announcement of the new property zone rates that will apply from January 1, transactions are gaining pace both in Greece’s major cities and tourism destinations, and in small villages. This is because the leveling up of objective values closer to market prices will bring significant hikes to zone rates, also taking property taxes higher.

The postponement of the changes to objective values and taxes until 2022 has been approved by the European Commission because of the pandemic. In the meantime, the property transaction value register reveals a considerable rise in sales in the last couple of months. For example, 1,480 properties changed hands in the first five months of the year in the City of Athens, up from 736 by end-March.

This is attributed to recommendations for objective value hikes reaching as high as 50%-60% in downtown Athens. In the northern suburbs the hikes recommended are far more moderate, between 10% and 20%. The southern suburbs expect bigger increases thanks to demand from abroad and their proximity to the Elliniko development.

The biggest planned increases, however, are in the countryside, especially in small villages, where the previous government had decided to keep rates low. Data point to hikes in 6,000 zones and the freezing of rates in 3,000-4,000 zones.

Meanwhile, a Commission report revealed on Wednesday that next year’s ENFIA will be paid as of March 2022 instead of August or September. This means that as soon as the 2021 ENFIA installments are paid out, in February, the tranches for next year’s tax will start being due. The aim is to put some distance with the income tax installments that currently coincide with ENFIA in the second half of the year.