What you need to know:
The process of buying property in Rhodes is fairly quick and uncomplicated.
As a general rule, you must:
- Select your property.
- Make sure financing for the purchase is secured.
- Appoint your solicitor, notary public, surveyor, and accountant.
- Apply for your Blue Card.
- Apply for your Tax Registry Number (AFM).
- Open a Greek bank account.
- Sign the pre-contract detailing terms of sale and payment schedule.
- Pay a 10% deposit to secure the property by removing it from the market; usual
payment methods include cash, bank transfer or credit card.
We will guide you through the process, every step of the way.
• You will need a solicitor. He carries out necessary legal surveys and conducts
a property title check for the past 20 years. They ensure the property is free
of any mortgage notes, claims, expropriations, rights-of-way and, in general,
any legal encumbrances. In addition, solicitors ensure that all property taxes
burdening the vendor have been paid. Solicitor services are going to cost you 1%
of the purchase price.
• You will need a notary public. He is a government-appointed lawyer who
processes and certifies all real estate transactions, including drawing up and
reviewing all official documents, to ensure the legal transfer of the property.
All contracts must be drawn up and certified in the office of a Notary Public
appointed by the buyer. According to the law, representatives of both parties
must be present when the contracts are being signed. Greek revenue offices
demand that buyers prove they have the means to buy, and that sellers show a tax
declaration of the respective property. Without these documents any contract may
be void. Notary Public services are going to cost you 2% of the purchase price.
• Surveyor is also needed to ensure that all acts associated with the
construction of the property are based on lawful planning permissions.
• It is essential to hire an accountant early on to help you with tax returns
and explain taxation laws to you.
• Tax number (AFM) is mandatory for all buyers, including foreigners and
permanent residents abroad. It is issued at tax offices in one day, free of
charge. All applicants must present their passport and their birth certificate.
If you have granted your solicitor full Power of Attorney, he can apply for an
AFM on your behalf.
• You will have to pay The Tax Assessed Value. It is the estimated monetary
value of a property according to the Greek tax authorities. As a general rule, a
property's Tax Assessed value is significantly lower than its purchase price.
• You will need to open a bank account. All necessary payments will be made
through this account. Also, this account will prove that funds used for property
purchase have come into Greece from another country and are, therefore, not
taxable in Greece. Opening a bank account in Greece only takes a few minutes and
requires no minimum opening deposit. All you need is your ID or passport and
you’re tax number (AFM).
• For EU nationals a temporary residence permit called the Blue Card is required
in order to purchase property in an area near national border such as Rhodes.
You must apply for it in person at the local police station. Issuance takes
approximately two weeks, but your solicitor can collect it on your behalf if
granted Power of Attorney. This permit is a formality for EU nationals.
• For non-EU nationals you must apply for a special permit issued by the
Ministry of Defense in Athens. An alternative and more efficient way to purchase
property in these areas is through an offshore company in your name, based in an
EU country. This is fairly commonplace. Setting up and maintaining such a
company costs approximately 2.000 euros to establish and 1.500-2.000 euros
annually. Both procedures are well known to the lawyers of Rhodes.
Return to Greece to sign the final contract, after all legal work is completed
(6-8 weeks, usually). Alternatively, your solicitor may sign for you if he has
been granted full Power of Attorney. Upon completion of final contract, all fees
and taxes must be paid.
Closing costs, including all fees and taxes, are an estimated 13-15% on top of
the purchase price. (10-12% fees, taxes etc, 1% solicitor and 2% notary public)
- For properties remaining in one’s ownership for 0-5 years: Capital Gains Tax
20%
- For properties remaining in one’s ownership for 5-15 years: Capital Gains Tax
10%
- For properties remaining in one’s ownership for 15-25 years: Capital Gains Tax
5%
You will have to pay an annual property tax if your property’s tax assessed
value exceeds 243.600 euros. (Please bear in mind that Tax Assessed Values are
lower than actual values)
Buildings in Greece are designed and constructed in accordance with European
Regulations and standards, and they are in total compliance with stringent
regulations for earthquake protection.
