Property market in Greece is stuck in a rut


Greek bureaucracy is on a par with Uganda’s regarding the procedures required for the sale of a property: Following the government interventions of the last few years, it now takes a total of 10 documents, certificates and so on for anyone to be able to sell one item of real estate in Greece, the same number as in the African country whose recent history has been marked by internal and external conflicts, according to the weekly bulletin of the Hellenic Federation of Enterprises (SEV).

The industrialists’ group makes it clear that excessive taxation and red tape have harmed the property market to such an extent as to devalue it considerably and rendering a recovery unfeasible.

There are fears that even an economic rebound would fail to resurrect the market, given the burden that property ownership entails these days. SEV warns that the return of the capital gains tax from 2017 and the introduction of new procedures for property transactions (such as certificates from civil engineers and electronic building identification) will add to the market’s negative prospects.

“Crisis and taxation have devalued real estate, so households and enterprises have become hostage to the properties they own,” notes SEV, as owners cannot sell their assets easily or pay the taxes associated with them.

Suddenly “properties valued above market prices by the authorities require more than a month’s salary or pension for their ownership tax. The Greeks became rich in the eyes of the state just when they had stopped being rich and when the state has made transactions impossible,” the industrialists argue.

SEV recommends the abolition of the capital gains tax, because, as things stand now, from next year, anyone purchasing a house will have to pay the tax they would normally pay in the future in advance instead. It also calls for the drastic simplification of the transfer procedure, the creation of a more functional framework for the utilization of properties with several owners, and the long-term calculation of objective values (property rates used for tax purposes) just below the minimum market prices available.