Greece is still unattrac­tive for in­vestors in the prop­erty sec­tor

Kathimerini English - - Focus - BY NIKOS ROUSSANOGLOU

Greece re­mains among the least at­trac­tive des­ti­na­tions for for­eign prop­erty buy­ers look­ing to make an in­vest­ment. A list drafted by the Global Prop­erty Guide – an in­ter­na­tional provider of in­for­ma­tion for prop­erty in­vestors – has placed this coun­try 32nd among 36 states, as its prospects for an in­vestor are seen as quite unattrac­tive.

The Global Prop­erty Guide re­port stresses that the high tax­a­tion of rental in­comes and the high cost of trans­ac­tions (trans­fer tax, var­i­ous stamps etc) are strong coun­ter­in­cen­tives for in­vestors.

Greece has one of the high­est rental taxes, com­ing eighth among 42 coun­tries. For the first 12,000 eu­ros of an­nual rev­enues from rent the tax comes to 15 per­cent, up from 11 per­cent un­til 2015. For rev­enues be­tween 12,000 and 35,000 eu­ros per year the rate soars to 35 per­cent.

The high in­come tax com­bined with the huge own­er­ship tax (ENFIA) and the coun­try risk of Greece over the last few years, have forced any in­vestors of the lo­cal buy-to­let mar­ket to seek higher re­turns. Con­se­quently, and de­spite the drop of home prices by some 45 per­cent since end-2008 in At­tica, Global Prop­erty Guide con­cludes that prop­erty prices re­main high in re­la­tion to the in­comes an in­vestor can ob­tain from them.

Of course, there are still a few op­por­tu­ni­ties with high yields, such as apart­ments in the his­toric cen­ter of Athens. With a mod­er­ate restora­tion, in­vestors can use the pop­u­lar­ity of short-term leas­ing plat­forms such as Airbnb and Homeaway to fetch sig­nif­i­cant rev­enues from vis­i­tors to the Greek cap­i­tal, as is al­ready the case, ac­cord­ing to Global Prop­erty Guide. A sim­i­lar trend is grad­u­ally ex­pand­ing to the rest of Greece, par­tic­u­larly in ar­eas that ben­e­fit from the high flow of tourism.

The other point of in­ter­est for for­eign in­vestors is lux­ury homes in the coun­try­side, es­pe­cially in tourism hotspots: Vil­las on My­conos, San­torini, Crete (Elounda in par­tic­u­lar) and other ar­eas can fetch al­most twice as high yields as a (rel­a­tively ex­pen­sive) prop­erty in the north­ern sub­urbs of Athens.

An anal­y­sis by Al­gean Prop­erty has ar­gued that the Greek lux­ury hol­i­day home mar­ket on is­lands such as My­conos and San­torini is par­tic­u­larly com­pet­i­tive com­pared to other Mediter­ranean des­ti­na­tions such as Ibiza, Ma­jorca, Nice and Cannes.

In­vestors can find op­por­tu­ni­ties with high yields, such as apart­ments in the his­toric cen­ter of Athens. With a mod­er­ate ren­o­va­tion they can use the pop­u­lar­ity of short-term leas­ing plat­forms to fetch sig­nif­i­cant rev­enues.

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