K A T H I M E R I N I l S1SATURDAY – SUNDAY, MARCH 31 – APRIL 1, 2018

By ILIAS BELLOS

After a deep correction in the first halfof the decade, the Greek real estate mar-ket has returned to stability, and tourismsector properties and office spaces areeven seeing an appreciation. At the sametime, investor interest is proliferatingand sentiment is improving. Neverthe-less the prospect of a further recoveryof the real estate market hinges, interalia, on the strengthening of the Greekeconomy's outlook, improved businessand household confidence, an easing ofbank financing conditions, a reductionof red tape, the completion of the na-tional cadaster and the consolidation ofa stable tax framework, according to theBank of Greece.

The decline of the Greek real estatemarket began in 2009, mainly driven bythe contraction in GDP per capita, thedrop in mortgage loans and the rise intaxation, dragging investments and res-idential property prices lower, Pricewa-

terhouseCoopers calculates. A loss of ap-proximately 18 billion euros (8.2 percentof GDP) in construction investments wasobserved within 2008-15, resulting in afurther slowdown in economic activity.“For the rapid recovery of the real estatemarket, a new regulatory framework,along with measures to facilitate trans-actions (creation of a land bank) and re-duce oversupply (massive redevelop-ment) are needed,” a relevant PWC paperstresses.

However, prime properties in eachsector are already staging a strong come-back, with five-star hospitality assets atthe forefront.

In a clear sign of the improvement ininvestors' perception of Greece, the num-ber of investors willing to consider in-vesting in real estate in Greece in 2017

was twice that recorded in 2016, accord-ing to a study by NAI Hellas, a leadingfirm of commercial property consult-ants, valuers and managers based inAthens, which provides a wide range ofreal estate consultancy services.

Investors’ prospects for Greece in thenext five years are significantly highernow compared to 2016, with 48 percentof respondents in the NAI Hellas pollstating that the potential of the country’sRE market was good or very good. “Theturning point of the Greek economy isthe main driver for investors that is ex-pected to consequently lead to capitalappreciations. The high number of dis-tressed properties remains one of themost important drivers although it stillranks lower than in 2016. The continuinggrowth of Greek tourism is again a main

driver for participants, while, for the firsttime, the completion of the second re-view of the country’s program with theinstitutions [European Central Bank, Eu-ropean Stability Mechanism, Interna-tional Monetary Fund, European Com-mission] appears to have impacted in-vestors' intentions. On the other hand,the county’s taxation on real estate re-mains the biggest barrier for the major-ity of respondents, followed by the lackof quality investment product. Whilethe political risk factor has decreasedsince 2016, public sector intervention inthe completion of transactions is a majorconcern from investors' point of view.”

In the meantime Greece’s special res-idence program for foreign investors hastaken off, reflecting increasingly brightgrowth prospects as the country

emerges from economic crisis and itsgrowing importance as a gateway to theEuropean Union, according to Enter-prise Greece. In the last year, the numberof foreigners awarded a Greek GoldenVisa has soared, rising by more than 40percent from a year earlier.

Launched five years ago, at the heightof the country’s economic crisis, theGolden Visa program is now coming ofage amid a new wave of investor inter-est, particularly from countries such asChina, Russia and Turkey. There are sev-eral reasons for this, from Greece’s sun-ny Mediterranean climate and high qual-ity of life, to its low property prices. Abudding economic recovery plays a rolefor some investors, while for others it'spolitical uncertainty abroad. And sincethe law was revised in 2015, Greece’s

Golden Visa has become still more at-tractive to foreign investors, comparingfavorably with similar programs in coun-tries including Cyprus and Portugal. Astepped-up promotion program has alsohelped.

Greece’s Golden Visa program grantsa permanent residence permit – and ac-cess to 26 Schengen-area countries – toindividuals and their families who investa minimum of 250,000 euros in Greece,for example in real estate or other pro-ductive investment. According to thelatest data from end-November, a totalof 2,170 Golden Visas have been issueddirectly to foreign investors – and morethan 5,000 when family members areincluded – up from 1,522 at the end of2016.

After falling by as much as 50 percent

from their pre-crisis peak, and withbooming summer tourism buoyingshort-term rentals, Greek propertyprices now offer a highly attractive yieldon investment, industry experts say.That has drawn investors from China,who now account for almost half of allGolden Visa holders. But another rea-son is Greece’s EU membership. In thepast year, nationals from several neigh-boring Mediterranean countries – mostnotably Turkey – have also been buyingup Greek real estate, lured both by theaccess to the EU that a Golden Visa of-fers, as well as to diversify their hold-ings away from an uncertain climate intheir home country.

In the meantime, the rapid growthof short-term rental websites such asAirbnb, Homeaway, Booking and othersin Greece since 2010 has created a newplayer in the hospitality market. The risein the number of world travelers in com-bination with high hotel rates and de-mand for low-cost travel has made theseonline platforms very popular and boost-ed apartment prices in prime locationsand most certainly villas on Greece'sAegean and Ionian islands and coasts.

Furthermore a new real estate mar-ket segment is emerging in Greece, tar-geting high-net-worth individuals. Theleader in this field is TEMES, a premierdeveloper of luxury mixed-use resorts.Its Navarino Residences at Costa Navari-no in Messenia in the Peloponnese wasawarded as the “Best International Res-idential Development” and “Best Euro-pean Residential Development” for2017-18. Such developments present aunique opportunity to acquire luxuryfreehold real estate in Greece in privi-leged Mediterranean beachfront loca-tions.

More are following suit. Amanzoeand One & Only are creating luxury villasin Argolida and Kea respectively, whileon the so-called Athens Riviera morehigh-end properties are being built byAstir Pallas at Vouliagmeni and Grivaliaat Glyfada.

The wider market for Greek villas isconcentrated in some of the most pop-ular Greek tourist destinations, such asMyconos, Santorini, Rhodes, Corfu,Paros, Crete and the islands of the Sa-ronic Gulf.

The villa rental market in Greece,which appeals to the buy-to-rent in-vestors, is relatively new and still quiteimmature, but this also provides oppor-tunities for the smart investor

By LINA GIANNAROU

The phrase “hen fangbian,” which means“very convenient,” is one of the most com-mon in China. It is used daily, as conven-ience has become the number one virtueof everyday life. All transactions in thecountry are now made by mobile phone,using the WeChat and Alipay applications,something that is “very convenient.” So,what is it that makes someone from theother side of the world decide to up andmove to this little corner of the map,where, among other things, nothing iseasy or simple, but instead hassle is partof everyday life – the opposite of the Chi-nese saying? Perhaps we should ask our-selves this question, as the Chinese, Rus-sians, Americans, Turks and others whodecide to buy a home and settle here, seemto see something in our country that wehave become so accustomed to we don't

even notice it. Daphne Korombeli is alawyer who lives between Hong Kong,Shanghai and Athens, represents Chinesefirms and offers services to Chinese in-vestors who want to acquire a Greek res-idence permit by buying property.

“The Chinese love Greece,” she tellsKathimerini. “For some it is a real lifedream to travel to Santorini and see the‘sea of love,’ as they call the Aegean.”

The investment opportunities in ourcountry have brought this dream closer,and quite a few of them have decided tomove here permanently after buyingtheir property. “They like the weather,the clean air, the blue sky, the fruit andvegetables bursting with flavor. Imagine

that when you wake up in Beijing, Shang-hai, Guangzhou or Chengdu, the firstthing you do is open the application thatreveals the daily pollution index andwhether you should or should not leavethe house, if you should or shouldn't openthe windows, if it's a particularly danger-ous day for vulnerable groups to be out-side,” she explains.

According to Korombeli, the prices inGreece are a world away from those inChina. A 100-square meter apartment ina compound in Shanghai's Jing’an Districtor a refurbished lane house apartment inthe traditional Former French Concessioncan cost close to a million euros. The Gold-en Visa program has gradually attracted

huge interest. “In 2013, when the law wasintroduced, the real buyers were few andfar between.

I remember when my first Chinese cus-tomer came with me to Athens to sign apower of attorney in September and,when her property was bought, I went tothe relevant state service to submit herapplication for a residence permit, the em-ployee didn't know what I was talkingabout. The manager then told me that thiswas the first residence permit that hadbeen issued under this law. Today thingshave completely changed. The increasein interest is gradual and apparent everyyear,” she says.

Those who express interest are mainly

businesspeople who have the money toinvest and already have companies out-side of China. The Golden Visa is the num-ber one reason for their investment asGreece's residence program is the cheap-est in Europe – and gradually also becom-ing the most popular.

Investors are buying property mainlynear the sea, “even thought they do notlike swimming or sitting under the sun,”Korombeli says.

Alexandros Varnavas is also a lawyerspecializing in property investments byforeign nationals. According to him, theGolden Visa program is only one reasonpick Greece.

“People of all nationalities who ex-

press an interest have, one way or anoth-er, an emotional connection with ourcountry. Turks feel a certain familiaritybecause of our food but also because theyhad grandparents who lived here, theRussians love the country because of theweather, the Chinese admire it for its his-tory. Nobody sees it merely as an invest-ment – for everyone it is somethingmore,” he says.

The political instability of previousyears had dented interest, but now mostpeople believe the danger of Grexit haspassed, the economy has stabilized andthe property market in central Athens isstarting to recover. “It's not just third-country nationals who want to invest, but

also Swiss and Israelis. In Israel for exam-ple, it is rumored that wealth will be heav-ily taxed so many people are deciding todiversify their risk. Besides, everyone ex-pects prices in Greece to rise sharply, thatsoon one euro will cost two. At the sametime, it is the best and cheapest programin Europe that allows many people tocombine business with pleasure,” headds. In addition to that, a large sectionof buyers don't just want to have a sum-mer house or to rent the property for extraincome, but wish to relocate permanentlyto Greece. “They want to be fully integrat-ed into Greek society, they search forschools, universities. These are mostlywealthy people who want to change theirlives,” Varnavas says. Anna Haughton,an American with Greek roots, lives andworks in Athens as an investment adviser.In the past few years, she has handleddozens of cases of Americans who wantto acquire property in Greece.

“Greece sells itself. Athens is a livelycity with an amazing expat community,a museum in every corner and great forwalking,” she said, adding that shewalked to our meeting in central Syntag-ma Square from Kypseli, a good half-hournorth.

“There are many Americans whowould like to buy a house here, others be-cause they claim ancestry in the country,others because they love Greece and al-ways wanted to have property here. Someof our customers are thinking about re-tirement, others want to rent the propertythrough Airbnb for a while to cover ex-penses and others for a combination ofthose reasons,” she adds. There are alsoplenty of Americans who were alreadyliving in Greece and decided to buy ahouse because the one they were livingin was rented out to Airbnb. The mostpopular districts are those which have re-tained their value, such as Thiseio, Plaka,Monastiraki, but also Pangrati, Kolonaki,Ilissia and Petralona. As of late, interesthas also been expressed in neighborhoodssuch as Kypseli.

“I love Athens,” says Haughton. “Ifthey also cleaned it up a bit, it would begreat.”

Sun, sea and residence permit luring investors to snap up Greek properties

Greece’s Golden Visa program grants a permanent residence permit – and access to 26 Schengen-area countries – to individuals and their families who invest a minimumof 250,000 euros in Greece, for example in real estate or other productive investment

Many potential buyers feel a certain familiarity because of our food but also because they had grandparents who lived here, the Russians love the country becauseof the weather, the Chinese admire it for its history. Nobody sees it merely as an investment – for everyone it is something more.

S P O N S O R E D S E C T I O N

<<<<<<

“The Chinese love Greece. For some it is a real life dream to travel to Santorini and see the ‘sea of love,’ as they call the Aegean.”

<<<<<<

The special residence pro-gram for foreign investorshas taken off, reflecting in-creasingly bright growthprospects as the countryemerges from economiccrisis, while it remains animportant gateway to theEuropean Union

Greek properties attract many foreignersHigh-end resorts and villas catering to needs of high-net-worth individuals put market on new footing

R E A L E S T A T E

EN0403_01+ 29/3/18 6:38 μμ Page 1

EN0403_02_ 29/3/18 6:39 μμ Page 1

K AT H I M E R I N I l S3SATURDAY – SUNDAY, MARCH 31 – APRIL 1, 2018

By NIKOS ROUSSANOGLOU

The rapid rise of the short-term rentalphenomenon, whereby furnishedrooms, houses and apartments areadvertised online on platforms suchas Airbnb and HomeAway, as well asBooking and Trivago, is evolving intoa factor that is reshaping not only thehousing market but also real estateentrepreneurship in Greece.

In 2016 and 2017 such rentals toforeign visitors started to soar, to theextent that the annual turnover ofthe home-sharing sector in Greece isnow estimated at 860 million eurosbased on guests’ accommodation ex-penditure, and at 1.7 billion euros ifone adds the other expenses thosevisitors make in the country.

A recent study by Grant Thorntonfor the Hellenic Chamber of Hotelsshowed that the total number ofproperties registered for letting ononline platforms amounts to 42,155across Greece. Another 21,716 prop-erties are rented as tourism accom-modation (bearing the badge of the

Greek National Tourism Organiza-tion), raising the total number ofhouses and apartments leased outto 63,871.

These figures are constantlygrowing, at least as far as Athens isconcerned. In the city center it isnow estimated that there are some6,500 houses and apartments beingrented out for short stays, whichconstitutes a 27 percent increase

from just six months ago, when anestimated 5,130 properties were be-ing advertised on such platforms.This growth is leading to the emer-gence of new needs on the part ofowners as well as investors who areinterested in positioning them-selves in this new market with ma-jor growth prospects, given thesoaring tourism arrivals in Greecein the last few years. In this context

there is demand for more profes-sional property management serv-ices, as competition among prop-erty owners also keeps growing.

Today property management isoffered for this particular categoryof assets by existing companies inthe property sector that predate therise of Airbnb etc, as well as estateagencies and even constructionbusinesses that have turned to

home-sharing due to the lack of de-mand in the Greek market. Thereare also companies such asEazybnb, which have been createdexclusively due to the growth inshort-term rentals. Eazybnb offersthe full range of property manage-ment services to owners, from pro-motion to bookings and cleaning. Itis ideal for owners who are eitherunable or not interested in taking

care of these things by themselves.The company collects a commissionranging from 15 to 20 percent fromthe owners’ revenues.

Currently Eazybnb manages 230properties across the country, 140of which are in Athens, while bymid-2019 it estimates the total fig-ure will have risen to 500. Accordingto the company’s co-founder andproject manager Nasos Gavalas, theaim for this year is the addition ofproperties in more destinations andpopular tourism resorts, such asCrete (Hania and Iraklio), Myconos,Zakynthos, Porto Heli, Spetses andEpidavros, as well as expandingabroad, beginning with Cyprus.Plans also include an increase in thecompany’s presence in areas suchas Thessaloniki, Halkidiki, Paros,Galaxidi and Arachova.

The growth of the short-termrental market has attracted a multi-tude of investors too. Gradually theentire ecosystem of people involvedin this domain will shift to a moreprofessional basis, as is already hap-pening. Data show that over 50 per-cent of the properties for leasethrough the Airbnb platform in thecenter of Athens are owned by pro-fessionals or investors who rent outmore than one unit. A significantshare of them are foreigners who arelooking forward to future capitalgains when they sell the propertiesthey have acquired. There is consid-erable demand, which in turn cre-ates more opportunities in the mar-ket. Homm is one company that hascapitalized on this demand, as aproperty investment and construc-tion firm founded in 2000 has since2004 developed a presence in thesector of tourism and accommoda-tion. Homm director Dimitris Rizosexplains that “with the increase ofshort-term leasings and the Golden

Visa program that grants residencepermits to non-European Union cit-izens who spend more than 250,000euros on property in Greece, we haveseen significant opportunities cre-ated for investment.”

Homm recently acquired and isleasing out an entire apartmentblock in the capital's Attikis Square,near the metro station, and has twomore buildings for utilization: oneon Mitropoleos Street in the city cen-ter with five apartments of 100square meters each, and another ithas prepared in nearby Plaka. Theinvestments in these projects addup to 1.5 million euros.

In total the company manages 43properties it owns, and manages an-other 100 or more properties belong-ing to third parties (shipowners, en-trepreneurs etc), in Athens, on My-conos and in other areas of hightourism interest.

Depending on demand, each ofthe properties that Homm man-ages – both its own and those be-longing to others – can also be sold,as the aim is for every property toturn into an investment productthat can fetch revenues for its own-ers through utilization or be soldon for capital gains. Homm's maintarget is foreign investors whowish to obtain a residence permit,while the company continues tomanage those properties even aftertheir sale. There is also demand forother services, which are con-stantly expanding: A case in pointis the Syncbnb startup, set up a fewmonths ago by Alexandros Karavi-tis and Petros Ziogas, which helpsshort-term property owners listtheir properties on multiple plat-forms in order to increase theirbookings, and synchronizes themto avoid the problem of doublebooking.

The notion that prices have completed their downward cycle has prompted more acquisitions.

Opportunities in central Athens and other locationsIn addition to the interest of many to reside in Greece, a multitude of investors is wooed by the growth of the short-term rental market

R E A L E S T A T E

<<<<<<

The country's residence-for-investment scheme is described as the best in Europe

EN0403_03_.qxp3+ 29/3/18 6:39 μμ Page 1

By NICK KALOFONOS,SENIOR MANAGER, TAX, KPMG

Greek value-added taxlegislation providesfor a number of waysto import goods intoGreece without han-ding VAT over to thecustoms authorities.One option is to tem-

porarily place goods arriving fromnon-European Union jurisdictions ina free zone (or similar setup), effecti-vely suspending the payment of cu-stoms duties and VAT until they aresold locally (if sold abroad, any suchpayment obligations apply in the re-spective country of destination). Ano-ther option is for Greek businessesto apply for a special VAT exemptioncertificate, on the basis of whichgoods imported into Greece can clearcustoms with the company payingonly customs duties, as long as theythen sell such goods abroad.

In addition to the above, the mostfavorable alternative allows large fo-reign businesses (or groups of foreignbusinesses) importing high volumesinto the EU to apply for a license, wh-ereby they can import goods intoGreece and customs clear them bypaying only the applicable customsduties. Required conditions includethat the goods’ value exceeds 250million euros per annum (100 millioneuros for the first five years) and thatat least 90% of such goods are soldabroad.

Although the above conditionsmay seem heavy, they can be metmore easily when foreign businessesapply to jointly come under one li-

cense. Besides, although the benefitsof the license may appear somewhatsimilar to those of the special VATexemption certificate, the license le-ads to a significant threefold advan-tage. First, holders incur reduced

costs of financing, since they do notpay import VAT when goods enterthe EU. Second, permitted domesticsales (i.e. less than 90% of the im-ported goods’ value) do not includeGreek VAT; rather, Greek corporate

clients apply the so-called “reverse-charge mechanism,” based on whichthey do not encounter any cash out-flow from a Greek VAT perspective.

Third, there is a decreased admi-nistrative burden in terms of EU cu-stoms formalities, since these aretaken care of at one single point ofentry into the EU, with goods beingsubsequently forwarded to EU ju-risdictions without passing throughcustoms. The above benefits canlead to more competitive pricingschemes, with license holders even-tually increasing their market share.For this reason, the recent trend isfor businesses trading internatio-nally to consider altering their lo-gistics flows, rendering Greece ahub where non-EU goods are cu-stoms cleared without VAT and thenforwarded to destinations in or ou-tside of the EU. At KPMG we havelong experience in assisting busi-nesses using the VAT exemption/su-spension regimes best suited totheir particular needs. We can helpyour business monitor physicalflows of goods imported into theEU and assess your eligibility, forexample, to obtain the above license.Where eligible, we can further assistin the compilation of the requireddocumentation and submission tothe Greek authorities, ensuring itssmooth audit until the license isduly issued.

The real question is whether youcan afford to allow competitors gaina comparative advantage, or whetheryou want to thrive and become amarket leader instead.

For more information: kpmg.com/gr

By ANESTIS DOKAS,IOANNA FOTIADI

The government is targeting the ex-pansion of Chinese placements in Gre-ece beyond property investments andis considering granting Golden Visasto non-European Union citizens whoinvest significant sums in local secu-rities, with the country looking at-tractive to Chinese investors for anumber of good reasons.Besides theprovision of a five-year residence per-mit to those who invest at least250,000 euros in the Greek real estatemarket, Athens is examining exten-ding the same incentive to non-EUcitizens who spend 300,000 to 500,000euros on investment products, whoplace 1 million euros in Greek staterepos or invest capital in domesticreal estate investment companies.

The first moves to woo mainlyChinese investors – who account for50-55 percent of the internationalfunds placed in investments – weremade last August when officials ofthe Capital Markets Commission andthe Athens Stock Exchange appro-ached the two main Chinese stockmarkets (Shanghai Stock Exchangeand Shenzhen Stock Exchange) andsigned memorandums of understan-ding with them.

Among the objectives of the MoUsis the effort to introduce exchange-traded funds (ETFs) in both countries,and mainly the introduction of a GreekETF in China and to a lesser extentthat of a Chinese ETF in Greece.

Hundreds of Chinese have alreadyobtained Golden Visas via propertypurchases, and also constitute thebest hope owners of local luxury pro-perties have for the concession oftheir assets. From June 2014, whenthe Golden Visa program started, untilNovember 2017 Greece issued 945Golden Visas to Chinese investors,

which accounts for 43.5 percent of allsuch residence permits issued in thatperiod, according to figures from En-terprise Greece.

Demand from China for Greek pro-perties has more than tripled withina year.

The increased Chinese interest inacquiring a holiday home in Greeceraises optimism not only among lu-xury property owners in this country,but also a series of related professions,such as estate agents, notaries andtranslators as well as those in thebuilding trade.

“The Chinese harbor great affectionfor modern Greece and admirationfor the ancient Greek civilization,”one estate agent commented. “Fur-thermore the Greek program is themost beneficial in financial terms th-roughout the EU,” he added.

The reasons behind the increasedChinese interest in Greece are morethan meets the eye: “Many of themwant to secure a better level of edu-cation for their children,” the samesource said. “They include their re-sidence permit in Greece in their ap-plications to leading US universities,as well as when seeking a place atone of the private international sch-ools that are considered the best inChina.”

A high number of Chinese peopleapply for a Golden Visa to obtain ahome outside China, “just in case.” Oth-ers are also worried about the financialsituation: “There is concern about abubble related to the bank loans thatuntil recently were very easy to obtain,”Alfieri added, further pointing to poli-tical concerns that have increased thedesire of some Chinese to leave theircountry. Therefore in the next coupleof months a number of property tran-sactions are expected to be completedin Greece involving Chinese peoplewho are not necessarily wealthy.

Opportunities in Greece wooing many Chinese

S4 l K AT H I M E R I N I SATURDAY – SUNDAY, MARCH 31 – APRIL 1, 2018

KPMG is a global network of professional services firms providing Audit, Taxand Advisory services. We operate in 154 countries and territories and have 200000 people working in member firms around the world. The independentmember firms of the KPMG network are affiliated with KPMG InternationalCooperative ("KPMG International"), a Swiss entity. Each KPMG firm is a legallydistinct and separate entity and describes itself as such.

TinosCyclades, GreeceA stunning villa of 352sq.m. on a 6.400sq.m. plot with a breathtaking view over the Aegean Sea.

VerbierSwitzerland

Incredibly located at the foot of the ski slopes in Les Esserts in Verbier, this superb

penthouse duplex of approximately 150sq.m. enjoys absolute tranquility.

BARNES is developing in the Greek market as BARNES Greece by a team with strong presence in the real estate, in order to manage a large property portfolio in Greece as well as unique locations abroad.BARNES International has got a very strong network across the globe, making BARNES Greece the best choice for finding properties not only in Greece but also abroad, providing a whole set of services according to the needs of the customer.

BARNES Greece 18, Kanari Str. | 106 74 | Athens 210 36 40 100, 210 36 40 108 greece@barnes-international.com | www.barnes-greece.com

Are you licensed to import goodsinto Greece without paying VAT?Benefits can lead to more competitive pricing schemes and increase of market share

R E A L E S T A T E

EN0403_04_.qxp3+ 29/3/18 6:41 μμ Page 1

K AT H I M E R I N I l S5SATURDAY – SUNDAY, MARCH 31 – APRIL 1, 2018

By MARCEL CREMER

1. IntroductionGreece has become afavourable invest-ment destination inthe last few years,mainly because of itsnatural beauty, mild

climate and geographical position,but also because of a significant dropin prices following the financial crisisthat emerged after 2010.

Investors from all over the worldare now looking at Greece as the new‘hot’ investment destination andrush to benefit from the abundanceof quality real estate available at af-fordable pricing. Many buy as endusers and others for buy-to-let.

Greece is a European UnionMember State abiding by the ruleof law. It is also a member of the Eu-ropean Monetary Union enjoyingall the benefits that derive from theEuro as a common currency with-out risks of devaluation or inflationvolatility.

The laws pertaining the acquisi-tion and ownership of real propertyare provided by the Hellenic Consti-tution and the Civil Code. Most prop-erties in Greece are freehold.

2. Legal framework

B.Rights in real estate

Real estate owners in Greece mayhave different rights. •Full ownership (absolute or joint)•Bare ownership (absolute or joint)•Usufruct (absolute or joint)

It is essential that the buyer es-tablishes which (among the afore-mentioned) is the right of the vendorto be transferred in every transac-tion, in order to ensure that the value

of the real estate is reflected in therights that come along with the sale.

B. Acquisition of real estate inGreece

There are various ways of acquisi-tion of real estate in Greece. The onesthat mainly concern investors are thetwo following:

Acquisition by contract, the buyerand seller appear before a notary pub-lic and sign a deed which is subse-quently registered At the local cadas-tre or land registry.

Acquisition of property through pub-lic auction. As of 2017 the Greek Statehas implemented electronic auctions.Greeks and foreigners (whether naturalpersons or legal entities) can subscribeonline. The procedure is open to thepublic and the properties offered areeasily accessible via a weekly journal.

3. The process of acquiring realestate in Greece:• After selection of the property, thebuyer appoints a lawyer in order toperform all the necessary legal search-

es. The title search takes place at theLand Registry and ensures that theasset in request indeed belongs to thevendor and that it is clear of any en-cumbrances (such as mortgages,liens, foreclosures etc). The lawyer al-so checks the suitability of the assetand if this is situated in areas whereprohibitions or restrictions apply.• Issuance of a tax number. It is a re-quirement of the Greek State thatevery transacting party (natural per-son or legal entity) has its unique taxnumber before acquiring real estate.

• Technical survey of the property.This is not a compulsory stage, but itis highly recommended as planningand or structural issues may occurthat could render the sale invalid orthe investment poor.• Payment of stamp duty (transfertax). Currently at 3% of the value ofthe transaction.• Completion of the acquisition con-tract before a notary public. The buyergest a title deed which is the first stepto ownership of the real estate.• The registration of the title deedtakes place at the local Land Registryand is the absolute proof of ownership.• Registration of the property onlinewith the tax authorities.

4. TaxationOwnership of real estate in Greece is

subject to annual tax (ENFIA) which iscalculated based on the value of eachproperty and in conjunction with thetotal value of the assets one may havein their portfolio. Currently the annualtax is payable in 5 instalments and it isapplicable in all types of real estate as-sets – including cases of rights on prop-erties (as mentioned in 1. above). Thiskind of tax applies to both natural per-sons and legal entities regardless if theyare resident and/or have their registeredseat in Greece or not.

Property based income (short or longterm rentals, Airbnb, long term leasesetc) are subject to taxation. Natural per-sons who benefit from rental income aretaxed at various rates (thresholds are inplace depending on the amount of rev-enue produced). Legal entities owningreal estate assets are taxed differently asthe rental income is regarded as revenueand is subject to 29% corporate tax.

5. Important parameters for con-sideration prior to the acquisition

As with every other country, cer-

tain restrictions apply investors de-cide to buy real estate in Greece:

Acquisition in forest areas. Sub-ject to the Hellenic Constitution,land uses in areas regarded as forestcannot be changed.

Acquisition of real estate in re-gions close to the border. There arespecific prerequisites for acquisi-tions in areas close to the borders.In these areas, foreign investors canacquire real estate following specialpermission by joint ministerial ap-proval. A specific list that is publiclyavailable names which are such ar-eas. Strict restrictions apply and in-vestors should examine thoroughlysuch plots prior to a purchase.

Acquisitions outside urban zon-ing. Special attention must be paidto plots which happen to be outsidecity or major housing estates as theyoften have limitations with regardsto the development capacity they of-fer and in most cases plots cannotbe divided in smaller segments.

Acquisitions on the coastline. De-velopment of real estate that is sit-uated close to the beach or generallythe shore may be prohibited or al-lowed under very specific terms setby the State.

Acquisitions in areas where an-tiquities are found. Developmentmay be prohibited or allowed undervery specific terms in areas wherehistoric monuments may be located.In most cases, a special permissionis required by the Ministry of Cul-ture’s competent directorate.

Acquisitions in areas of outstand-ing natural beauty (Natura) or undera special environmental protectionregime. Both acquisition and devel-opment of real estate in such areasmay be blocked by the Ministry ofEnvironment due to restrictions thatmay apply.

Development of real estate that is situated close to the coast may be prohibited or allowed under very specific terms set by the State.

Acquisition and ownership of Real estate in GreeceBasic legal framework, property rights, procedural issues of acquisition, and restrictions

R E A L E S T A T E

EN0403_05_ 29/3/18 6:47 μμ Page 1

S6 l K AT H I M E R I N I SATURDAY – SUNDAY, MARCH 31 – APRIL 1, 2018

By APOSTOLOS LAKASAS

International schools have become aninstitution in Greece, offering lessons inEnglish, French, German and other lan-guages. The first law concerning theiroperation was introduced almost ninedecades ago, in 1931.

According to Law 4186/2013, 29 pri-vate international schools are currentlyoperating in Greece, mainly in Attica,and primarily host pupils of foreign na-tionality whose parents live or wish tolive in Greece. However, the fact thatmany Greek parents choose to send theirchildren to such schools is indicative oftheir high quality – at least some of them.

A key feature of international schoolsin Greece is that they follow the curricu-lum of the reference country and notthat approved by the Greek Ministry ofEducation. Thus, international schoolsare mainly established by foreign em-bassies to meet the needs of their citi-zens living in Greece. That’s where mostof their pupils come from, and theirteachers are mainly foreign nationals.

Nonetheless, students from countriesother than the country of reference canattend these schools. In classes of inter-national schools which follow the cur-riculum of a European Union member-state, or a combination program inwhich one of the countries involved isa member-state of the EU, it is permis-sible for students of EU citizenship toattend, without restrictions.

On the other hand, internationalschools emphasize foreign-languageteaching (with several hours of teachingin a language other than Greek eachweek), and are an excellent choice forbilingual children.

International schools in Greece coverall levels of education, from kinder-garten to high school. All schools musthave acquired an operating licensebased on Law 4186 and parents mustbe particularly careful if they want to

choose a school not mentioned in theofficial list.

According to the law, “the unautho-rized operation of a foreign institutionwill result in its closure by a decision ofthe Ministry of Education, which is ex-ecuted by the competent police author-ity.” Certificates issued by internationalschools are considered equivalent tothose issued by Greek schools of thesame grade.

Thus, they are also suitable for chil-

dren with Greek as their native languagewho intend to study abroad or thosewho want to achieve fluency in the mainforeign language of the school. In fact,following pressure by Greek parents,and EU legislation, a law was passed in2009 allowing Greek nationals to studyat international high-schools.

International schools are private,with tuition depending on the level ofeducation (kindergarten, elementaryschool, junior high school or high

school) as well as the additional serviceseach school offers.

The International Baccalaureate For children aged 15, another option

available is the International Baccalaureateprogram, which is offered in private schoolsin Greece. The program corresponds to thelast two years of secondary education andis aimed at pupils aged 16-19. In Greece,the IB program is offered at 13 private

schools and is considered to open doors toacclaimed universities abroad. It is indica-tive, according to a 2013 survey, that 72percent of Chinese students who have tak-en the IB entered one of the top 500 uni-versities in the world. The courses at allthe schools around the world offering theprogram are the same. Specifically, the IBis made up of six subject groups, including:Mother Tongue, Foreign Languages,Mathematics, Arts, Social Sciences, Eco-nomics, Experimental Sciences, Computer

Science, Ancient Greek – with studentschoosing a course from each group. Allcourses are taught in English. As for theexams, they are held simultaneously inthe final year of high school, while the ex-amination subjects are selected from theIB exams headquarters. Those interestedin the program can learn more about at-tending a school in another EU countryon the website: https://europa.eu/youreu-rope/citizens/education/school/enrol/faq/index_el.htm

Epsilon team is a business of special featureswhich makes it different than the rest of thereal estate agencies in Greece. It is a group of9 people who cooperate closely with each otherto complete any project they have taken on. Itis the only group that has constant legal sup-port – both for the company as well as for anyquestions or problems its customers mighthave – given the fact that the laws concerningbuying and selling are very versatile and by de-fault rather complex in Greece.

Additionally to the free legal advice that Epsilonteam provides its customers with, it has estab-lished a constant partnership with experts andscientists that might be needed when buying realestate. There is an Interior Designer, a Civil En-gineer and an Architect, the services of whom aretotally guaranteed by the company.

All of the above-mentioned partners provide

their services to the customers of the Epsilonteam, giving them priority as well as a 20% dis-count.

The Epsilon team covers all the prime locationareas in the north, the south and the center ofAthens when it comes to buying or renting. Thereis also a special department for the independentand commercial buildings and shops. The Epsilonteam also deals with selling residential real estateby the sea.

To provide better service to our customers wecooperate with real estate agencies in big cities inEurope and we promote our real estate in Greekand international portals as well as in the Socialmedia.

The Epsilon team is a member of the AthensRealtors Association and the Athens chamber oftradesmen.

Our fee regarding the selling of real estate isbetween 2% and 6%, depending on the effort andthe cost of advertising needed to promote andsell a property, while it is just two percent forbuyers.

We have been operating in the last ten yearsby undertaking and completing projects thathave to do with finding properties based on ourcustomer’s needs and not on what is in our port-folio. The specific demands are registered in ouroffice by special order and they are valid for thetime period which is necessary to find the rightproperty, as mutually agreed between us and thecustomer.

Call us and ask us to discover your dream prop-erty on your behalf. When it comes to the Epsilonteam, the expression IT DOES NOT EXIST sim-ply… DOES NOT EXIST.

R E A L E S T A T E

High level international education for foreignersMany choices for parents with schools that follow the curriculum of the reference country and not that of Greece

The many international schools cate to the needs of families from abroad

According to Article 35 of the latest 2013 law (4186), the new list ofinternational schools in the country is the following:

1. German School of Athens (Deutsche Schule Athen)2. German School of Thessaloniki3. Lycée Franco-Hellénique Eugène Delacroix4. Italian School of Athens (Scuola Italiana Statale di Atene)5. American College Anatolia6. American College of Greece 7. École Franco-Hellénique du Pirée Saint Paul8. Greek-French School Jeanne D' Arc 9. Greek-French School Kalamari

10. Greek-French College Delasalle 11. Leonteios School of Nea Smyrni12. Greek-French School Saint Joseph 13. Greek-French School Ursulines 14. Leonteios High-school in Patision 15. American Community Schools of Athens 16. French Primary School of Thessaloniki17. French School of Thessaloniki (Junior high-school, high-school)18. International Community School of Larisa19. Katipunan Philippines Cultur al Academy 20. Byron College 21. Pinewood School of Thessaloniki22. Polish School Zygmunt Mineyko 23. St. Catherine’s British School24. St. Lawrence College25. International School of Athens 26. Campion School 27. Iranian School of Athens28. “7th of February” Libyan School 29. Canadian Lyceum of Greece

List of international schools

EN0403_06+ 29/3/18 6:49 μμ Page 1

Rhodes@engelvoelkers.comwww.engelvoelkers.com/rhodes

Phone +30 22410 79410 · Estate Agent

We giveyour holidays

a home.

Finest real estatein Rhodes.

EN0403_07_ 29/3/18 6:50 μμ Page 1

Greek GoldenVisa Program:

A Success Story

*ARIEL MANIKA, LAWYER/SENIOR MANAGER, TAX, KPMG

We have provided legal and taxassistance to a large number ofnon EU investors receivingGreek residence permit throughthe Greek Golden Visa Program,since its inception. Our servicesinclude purchase negotiations,submission of residence permitapplication and follow up untilissuance, bank account open-ing, issuance of Greek tax regis-tration number, real estate reg-istry checks, drafting and sign-ing of notarial deed for the realestate purchase, annual tax fil-ings. Whatever the need, KP-MG‘s experts are there to assist.

Golden Visa ProgramIn line with the direction

adopted in recent years bymany European countries,Greece introduced in April2013 its own “Golden Visa”program in an effort to attractforeign investments to con-tribute to a long term and sus-tainable growth for the Greekeconomy.

The Greek Golden Visa pro-gram is an attractive optionfor those seeking investmentopportunities and/or residencein the European Union espe-cially given the ideal geo-graphical position of Greece.The program stipulates that afive year residency permit isgranted to non EU citizenswho are investing in real es-tate in Greece. Purchasedproperty can be located any-where in the Greek mainlandor the islands, can be eitherresidential or commercial, inthe form of one single or mul-tiple properties, or even sharesin real estate holding compa-nies as long as the purchaseprice exceeds EUR 250 000.

The success of the program,while modest in the first coupleof years from its introduction,has increased significantly inrecent years bringing to thecountry funds of more thanEUR 1 billion.

Approximately 2 300 resi-dence permits have been issuedsince the commencement of the

program to the end of 2017 forreal estate owners (a total of ap-proximately 5 700, when alsocounting family members). Al-most half of these permits havebeen granted to Chinese nation-als with Russians holding sec-ond place and Turkish nationalsrising up recently to third place(obviously because of the politi-cal turmoil in our neighboringcountry). Other countries whosenationals have received resi-dence permits include Egypt,Lebanon, Ukraine, Iraq, Syria,Jordan, Iran, Saudi Arabia etc.

Analyzing the particulars of the program

Evaluating the factors of suc-cess of the program, one wouldsay this is mainly due to the lowlevel of investment required(EUR 250 000), the long term ofthe residence permit granted(five years subject to indefiniterenewals of five year periodsprovided the property is stillowned by the applicant), the is-suing of residence permits tothe applicant’s family membersas well, (spouses, children up tothe age of 21, parents of both ap-plicant and spouse), fast trackprocedures (40 to 60 days fromthe time of investment until res-idence permit is issued), no min-imum stay requirement (just alawful entrance into the coun-try) and low application fees(EUR 500 for each permit exclud-ing those for minor children).

The residence permit grantedthrough this program allowsthe applicant and his familymembers to live in Greece butnot to work. There is alwayshowever, the option for the ap-plicant and family members toestablish businesses in Greece,open bank accounts and ex-pand investments worldwide.The Greek residence permit al-lows freedom of travel for theapplicant and his family mem-bers throughout the EU Schen-gen zone without further visaapplications. If the residentsells the property to anothernon-EU citizen, the Greek resi-dency is revoked for him andhis family members and trans-ferred to the new investor on

condition that the new investormeets all the other terms of theprogram.

How is the investor taxed for hisGolden Visa investment in Greece?

Golden Visa investors maycontinue to be non-Greek taxresidents and only pay tax ontheir income derived in Greeceand not on income from outsidethe country. Taxes for rental in-come from property in Greecefollow a progressive tax ratestarting from 15% (for incomeup to EUR 12 000) and up to 45%(for amounts over EUR 35 000).Certain operating expenses aredeductible whereas when realestate is held through a legal en-tity, all expenses relevant to theexploitation of the real estateare tax deductible subject togeneral deductibility rules (cur-rent corporate income tax rateis 29%). Capital gains tax on thesale of real estate is currentlynot applicable (it has been post-poned since 2014 in an effort toboost the local real estate mar-ket) and as a result local real es-tate sales are only subject to atransfer tax at the effective rateof 3.09% burdening the pur-chaser and imposed on thehigher between the purchaseprice and the objective tax valueof the real estate. VAT at therate of 24% is applicable on thepurchase of new buildings.

Is the Greek citizenship “sold” to rich foreigners?

Unlike other similar Euro-pean programs, the GreekGolden Visa program is a resi-dency investment program anddoes not come under the “citi-zenship by investment” pro-grams which have raised muchcontroversy and have fuelednationalistic outcries in othermember states. In line with theEU principles on nationalitymatters, Greece is not sellingits citizenship, even though theoption for citizenship is avail-able for those committed to liv-ing in Greece. Applicants wholive in Greece can apply for citi-zenship and a passport afterseven years, subject to thesame conditions existing for all

other applicants as introducedin domestic immigration lawand in full implementation ofEU immigration legislation.Other investment opportunities

under the Golden Visa programAlthough the Ministry of

Economy and Developmenthas been examining the possi-bility to add more types of in-vestments valued at EUR 250000 to the Golden Visa pro-gram (for example shares andbonds), for the moment theredoes not seem to be any de-velopment towards this endespecially in view of the needto give a push to the longtime stagnated real estatemarket.

Indeed, there seems to bemovement in the local real es-tate market especially forproperties located in the socalled “historic center” ofAthens opening up a newbooming market which, ac-cording to what real estateagents say, is linked to theAirbnb business. Now the realquestion is whether the in-come of the State from taxesarising from the rental ofthese Golden Visa invest-ments will be equally thrivingsince rumor is that most realestate owners “forget” to de-clare Airbnb rentals of theirproperties in the tax notifica-tion electronic system“TAXIS”.

KPMG AT A CLANCEKPMG is a global network of

professional services firmsproviding Audit, Tax and Ad-visory services. We operate in154 countries and territoriesand have 200 000 peopleworking in member firmsaround the world. The inde-pendent member firms of theKPMG network are affiliatedwith KPMG International Co-operative ("KPMG Internation-al"), a Swiss entity. Each KP-MG firm is a legally distinctand separate entity and de-scribes itself as such.

For more information: kpmg.com/gr

EN0403_08_ 29/3/18 6:51 μμ Page 1