ECONOMY

Objective values set for revision

The commission charged with preparing the new system for the valuation of property prices for tax purposes, known as objective values, will deliver its report to the Finance Ministry in the next few days. It is expected to include significant reductions for several areas around the country, in line with the drop in market prices.

The commission has collected data from estate agents, notaries and the Bank of Greece in order to create a reliable database for the automatic adjustment of objective values, although it has been rather hard to establish actual sale prices of properties, given the low number of transactions in the last couple of years: From an annual average of 150,000 houses sold in the previous decade, there were only 11,000 transactions in 2011, which prompted the New York Times to brand Greece as the ideal market for house hunters on Friday, given the drop in prices that it said ranges between 30 and 50 percent.

As soon as the commission has delivered its report to the ministry, the revision of objective values will get under way. The first stage concerns the inclusion of properties outside town-planning zones in the objective value determination system, and then the values across the country will be adjusted.

Top Finance Ministry officials say that the new values will include reductions as well as increases. They add that in the last few years the market prices of properties have dropped considerably in several parts of the country, leaving objective values much higher than the market reality.

For instance, the average objective value in Maroussi, northern Athens, is about 30 percent higher than the commercial price used for transactions. The difference comes to 22 percent in Holargos, 26.3 percent in Palaio Psychico and 41.8 percent in Vouliagmeni, all upmarket Athens suburbs.

The level of objective values is particularly significant for taxpayers as it determines the level of a number of property taxes they pay as well as the estimate of their annual revenues used for the calculation of income tax.