Real Estate Investments in Greece

Real Estate Investment in Greece in 2024, An Overview

Real estate investment in Greece has become increasingly popular in recent years, driven by a combination of economic recovery, government incentives and the country’s appeal as a tourist destination.

After a prolonged period of economic crisis, Greece is showing signs of economic stabilization and growth, which has improved investor confidence in the real estate sector.

Real estate prices, which plummeted during the crisis, are rising but are still relatively low compared to other European markets, offering attractive opportunities for investors.

As the process of buying property can still be cumbersome due to bureaucratic hurdles and complex regulations, our law firm is here to assist you throughout the entire process of investing in real estate in Greece. Contact us today to learn more about our services

Real Estate Investments in Greece: Advantages

Greece is renowned for its rich cultural heritage, stunning scenery and Mediterranean lifestyle – factors that make it a desirable place to live and vacation, ensuring a steady demand for real estate.

From a business perspective, Greece’s strategic location at the crossroads of Europe, Asia and Africa makes it an ideal hub for business and travel, and its geographic location adds to the appeal of investing in Greek real estate by providing easy access to a wide range of markets and destinations.

While foreign investors were cautious about buying property in the country during the many years of financial crises, Greece’s economy has been steadily recovering and GDP growth and economic stability have boosted investor confidence, making Greek real estate a safer and more profitable investment.

In addition to the favorable location and cultural heritage, and the economic recovery and growth, there are many other advantages to investing in real estate in Greece:

• Rising rental yields: The resurgence in tourism and increased demand for rental properties has driven up rental prices, particularly in popular areas such as Athens, Thessaloniki and the Greek islands. This trend offers investors attractive rental yields and the potential for significant returns on investment through both long-term and short-term rentals.
• Government incentives and tax benefits: The Greek government has introduced various incentives to attract foreign investment in real estate. These include tax incentives for property renovations and favorable tax treatment for real estate income. Such measures increase the profitability of investing in Greek real estate.
• Stable real estate market: Despite past economic challenges, the Greek real estate market has shown resilience and stability. The market’s recovery and continued interest from international investors indicate strong potential for growth and long-term capital appreciation.
• Golden Visa Program: This program offers residency permits to non-EU nationals who invest in Greek real estate, with minimum investment thresholds set at €250,000 for certain categories such as heritage buildings and condominiums, and higher for prime locations. The residency permits provide visa-free travel within the Schengen Zone, making it an attractive option for investors seeking greater mobility within Europe.

All of these factors combine to create a favorable environment for real estate investments that promise attractive returns and long-term value.

How to Start to Invest in Real Estate in Greece

Investing in real estate in Greece can be a rewarding endeavor, but it requires careful planning and due diligence.

To get started, it is important to understand market trends and clarify your investment goals. Are you looking for short term rentals, long term rentals or personal use property? Your goals will influence your choice of location and property type.

There are several types of real estate investments available in Greece. These include:

• Primary Residence: For investors looking to relocate or establish a home base in Greece, the purchase of a primary residence can provide personal benefits in addition to potential capital appreciation.
• Secondary Residence: Secondary residences used for vacations or seasonal retreats can be rented out when not in use, providing additional income while meeting personal needs.
• Tourist Rental Properties: Often located in tourist hotspots such as Mykonos, Santorini and Crete, these properties are rented out to tourists for short stays or as vacation homes. They offer high rental yields and can generate significant rental income during peak tourist seasons.
• Heritage Buildings: Investments in historic properties in need of restoration. These can be particularly rewarding due to their unique appeal and potential for significant capital appreciation once restored.
• Student Housing: Purpose-built accommodation near universities, particularly in cities with large student populations such as Thessaloniki. These properties provide a steady stream of rental income from students.
• Seniors Housing: Properties that cater to the elderly, offering specialized care and amenities. As the population ages, these facilities are in increasing demand.
• Real Estate Investment Trusts: Investing in real estate investment trusts allows individuals to purchase shares of portfolios of real estate assets managed by a trust. It provides exposure to the real estate market without direct ownership of property.
• Commercial real estate investment trusts: Pooled investments in commercial real estate projects that offer diversification and professional asset management. These funds often focus on large-scale developments and income-producing properties.
• Residential leases: Investing in residential properties for long-term leases provides a steady and predictable income stream. Popular in urban areas such as Athens and Thessaloniki, these properties attract tenants seeking stable, long-term housing solutions.
• Commercial leases: Long-term leases for commercial properties, such as office space and retail stores, offer reliable returns. These investments are particularly advantageous in the business districts of major cities.
• Agricultural Land: Purchasing farmland is a long-term investment that can provide returns through agricultural activities or future resale for development purposes. This is more common in rural and semi-rural areas of Greece.
• Real Estate Development Projects: Involving the construction, renovation or redevelopment of real estate, these projects can be lucrative in the long term as the value of developed properties increases.

Once you know what is the right investment for you, it is time to choose the location. High demand areas offer various advantages such as high rental yields, tourist demand and property appreciation potential, while emerging locations such as Patras and the Peloponnese offer potentially lower entry costs and future growth prospects.

Determine your budget, taking into account the cost of the property, taxes, legal fees and potential renovation costs.

Work with local real estate agents who have in-depth knowledge of the market to find the right property to purchase, and hire a reputable local Greek-speaking real estate lawyer to assist with the legal aspects of the transaction, including title searches, contract review, and ensuring compliance with local laws.

Best Places to Buy Real Estate for Investment in Greece

Investing in real estate in Greece offers various opportunities in different regions. Here are some of the best places to consider for real estate investment.

Athens

The capital city remains one of the most attractive destinations for real estate investment in Greece.

Athens is the economic and business center of Greece, attracting both local and international companies. This creates a strong demand for residential and commercial real estate. The city’s rich history and numerous tourist attractions make it a popular year-round destination, ensuring a steady demand for short-term rentals.

Neighborhoods such as Plaka, Monastiraki and Koukaki offer high demand for both short and long term rentals due to their historical significance and proximity to major tourist attractions. Kolonaki, known for its upscale lifestyle and amenities, is a prime location for luxury apartments and commercial properties.

Thessaloniki

Thessaloniki, Greece’s second largest city, is a vibrant city with a growing demand for real estate.

The city has a diverse economy with significant contributions from education, tourism and trade. A cultural center with a rich history and vibrant arts scene, Thessaloniki attracts students, professionals and tourists, ensuring a diverse rental market.

Compared to Athens, real estate prices in Thessaloniki are relatively affordable, offering better value for money while still providing good returns.

In the city center, areas such as Ladadika and the waterfront offer excellent opportunities for both residential and commercial investment. Ano Poli, known for its traditional architecture and scenic views, is also becoming increasingly popular with investors.

Mykonos

Famous for its nightlife and upscale real estate, Mykonos is ideal for luxury villas and vacation rentals. Known for its nightlife, beaches and cosmopolitan atmosphere, Mykonos attracts affluent tourists, ensuring consistent rental income.

Mykonos is synonymous with luxury living and high-end tourism, and investing in upscale villas and vacation rentals can yield high returns.

In addition, the limited availability of land on the island increases property values, making it a safe investment option.

Crete

Crete offers a wide range of real estate options, from luxury villas to affordable apartments, to suit different investor needs.

With its historical sites, beautiful beaches and vibrant cities, Crete attracts millions of tourists, supporting a strong rental market. Areas such as Chania, Heraklion and Rethymno offer a mix of traditional and modern properties with strong rental demand.

The island’s strong agricultural and tourism sectors provide a stable economic environment for real estate investment.

Peloponnese

The Peloponnese region offers more affordable property prices compared to other popular destinations, making it accessible to a wider range of investors.

With its historical significance, natural beauty and coastal areas, the region is becoming increasingly popular with tourists, driving demand for vacation rentals.

Emerging infrastructure projects and local development plans make it a promising area for future growth.

Chalkidiki

Chalkidiki is famous for its beautiful beaches and resorts. It is an excellent choice for those looking to invest in vacation homes and tourism-related properties.

Located close to Thessaloniki, Chalkidiki benefits from the city’s infrastructure and economic activities, while offering a more relaxed and scenic environment.

Chalkidiki attracts both domestic and international tourists, ensuring a high demand for vacation properties.

The region’s growing popularity and ongoing developments offer good potential for capital appreciation.

Patras

As one of Greece’s major port cities, Patras offers opportunities in both residential and commercial real estate.

Its growing economy and student population make it a vibrant market for investment: the city has a steady demand for rental properties, especially around the university areas.

Property prices in Patras are generally lower than in Athens and Thessaloniki, offering affordable investment opportunities with good yields.

Tax Regime for Real Estate Investments in Greece

The tax regime for real estate investments in Greece in 2024 includes a combination of purchase taxes, annual property taxes, rental income taxes, and capital gains taxes.

Here’s an overview of the tax regime for real estate investment in Greece:

• Property transfer tax: This tax applies to the transfer of property and is paid by the buyer. The taxable amount is based on the market value of the property as determined by the tax authorities.
• Value Added Tax: 24% on new buildings with building permits issued after January 1, 2006. VAT is not applicable if the purchase is a resale property or if the property has been used for residential purposes for more than five years.
• Annual property tax (ENFIA): Consists of a main tax and a supplementary tax. The main tax rate is based on the size, location, age and other characteristics of the property. The supplementary tax applies to properties with a total value of more than €250,000. The rate varies depending on the total value of the property.
• Capital gains tax: 15% on capital gains realized on the sale of real estate. Properties held for more than five years may be exempt from capital gains tax under certain conditions, such as if the seller uses the proceeds to purchase another property within a specified period.

In addition, there are taxes on the income of individuals and companies that receive rental income from real estate.

Of course, due to the complexity of the matter, it is crucial for investors to consult with local tax advisors and legal professionals to effectively navigate these regulations and optimize their investment returns.

How We Can Help You Invest in Real Estate in Greece

Engaging a lawyer when investing in real estate in Greece is crucial, as they provide invaluable assistance in all key steps of the process, from initial legal due diligence, contract preparation and review, to post-purchase assistance.

Attorneys will ensure that all aspects of the transaction comply with Greek law, including payment methods, tax obligations and any required government notifications.

Our law firm will conduct thorough due diligence to ensure that the property you are purchasing has clear title and is free of legal disputes, liens or encumbrances. This step is crucial to avoid future legal complications.

We will then verify that the property complies with zoning laws and regulations to ensure that it can be used for your intended purpose (residential, commercial, etc.).

After this step, our legal experts can draft and review the purchase agreement and any other necessary contracts to ensure that they are legally sound and protect your interests, and assist in negotiating terms with the seller to secure favorable terms for you.

If necessary, we can assist in obtaining the necessary permits and licenses for the use or renovation of the property, streamlining the bureaucratic process.

Of course, our firm will continue to assist you after the purchase is completed. Should any disputes arise after the purchase, our attorney can represent you in court or arbitration.

Investing in Real Estate in Greece – FAQ

Here is a list of questions most of our clients ask about investing in real estate in Greece.

Is real estate in Greece a good investment?

Yes, real estate in Greece can be a good investment for several reasons.

Greece’s economy is recovering, which has had a positive impact on the real estate market.

Increased tourism and foreign investment have driven up real estate demand and prices. Popular tourist destinations such as Athens, Mykonos and Santorini offer high rental yields, especially for short-term rentals.

Greece’s rich history, culture, and beautiful scenery make it a desirable place to live and vacation, ensuring a steady demand for real estate.

Can foreigners buy property in Greece?

Yes, foreigners can purchase property in Greece. The process is open to both EU and non-EU citizens. In particular, non-EU citizens can benefit from the Golden Visa program if they invest a minimum of €250,000 in real estate.

Are property prices falling in Greece?

Real estate prices in Greece have been on the rise in recent years due to economic recovery, increased tourism and foreign investment. However, market conditions can vary by region and property type.

Major cities such as Athens and Thessaloniki have experienced price increases due to high demand and limited supply. Islands and tourist hotspots have experienced price increases due to tourism and short-term rental markets.

How to buy property in Greece from the UK?

Start by researching the Greek property market and setting a budget, taking into account additional costs such as taxes, legal fees and renovation costs.

Find a reputable local estate agent to help you identify properties that meet your criteria and engage a local lawyer to carry out legal due diligence, prepare contracts and ensure compliance with Greek law.

Your lawyer will help you with all the legal and practical steps required to buy a property in Greece, such as obtaining a Greek tax number, opening a Greek bank account, conducting a thorough inspection of the property and drafting the purchase contract.

Of course, it is advisable to visit Greece to view properties in person and get a feel for the local market.