Bring­ing ob­jec­tive val­ues down to mar­ket prices an up­hill bat­tle

Kathimerini English - - Focus - BY PROKOPIS HATZINIKOLAOU

The Fi­nance Min­istryis gear­ing up to bring the coun­try’s so-called ob­jec­tive val­ues used to de­ter­mine prop­erty taxes down to the level of mar­ket prices, with the aim of get­ting a new sys­tem up and run­ning from Jan­uary 1, 2018.

Two amend­ments tabled in Par­lia­ment late on Thurs­day pro­vide for the for­ma­tion of a co­or­di­nat­ing com­mit­tee un­der Min­is­ter Eu­clid Tsakalo­tos for the re­vi­sion of ob­jec­tive val­ues, and the creation of a Prop­erty Trans­fer Value Reg­is­ter.

The lat­ter amend­ment fore­sees the uti­liza­tion of the Prop­erty Value Bank data­base in the min­istry’s in­te­grated in­for­ma­tion tech­nol­ogy sys­tem, fed by a con­stant flow of data that will pro­vide the ba­sis for a dig­i­tal sys­tem to value prop­er­ties.

This will be the fore­run­ner to a new au­to­matic sys­tem that will re­place ob­jec­tive val­ues. How­ever, it will be ex­tremely dif­fi­cult for the com­mit­tee to cre­ate a re­li­able sys­tem by the end of the year with only ac­tual sale prices to rely on, as four in ev­ery 10 prop­er­ties sold to­day fetch prices deemed par­tic­u­larly low even by to­day’s stan­dards, which in turn il­lus­trates the dis­tor­tion of the lo­cal real es­tate mar­ket.

The data to be in­cluded in the Reg­is­ter will orig­i­nate from the In- de­pen­dent Author­ity for Pub­lic Rev­enue, the com­pe­tent Land Reg­istry of­fices and no­taries who co­op­er­ate with the min­istry. The Reg­istry’s ob­jec­tive will be to is­sue sta­tis­ti­cal con­clu­sions on the prop­erty mar­ket. Part of the data, as stated in the leg­is­la­tion in­tro­duced on Thurs­day, “could be pub­lished in a way that would safe­guard the anony­mous char­ac­ter of the par­ties in­volved, so as to pro­vide ev­ery in­ter­ested party (cit­i­zens, pro­fes­sion­als, en­ti­ties etc.) with the op­tion of ob­tain­ing a gen­eral pic­ture of the prop­erty mar­ket for in­for­ma­tion pur­poses.”

How­ever, prop­erty prices in Greece are still down by at least 40 per­cent in real terms. That means mar­ket prices are typ­i­cally 40 to 70 per­cent be­low the ob­jec­tive val­ues, and go­ing rates may be hard to in­cor­po­rate into the au­to­matic sys­tem, given also the rar­ity of trans­ac­tions nowa­days.

For in­stance, a 102-square me­ter prop­erty in the north­ern Athens sub­urb of Aghia Paraskevi was re­cently sold for 20,000 eu­ros, while its ob­jec­tive value stands at 127,500. In the south­ern sea­side sub­urb of Alimos a 176 sq.m. house with an ob­jec­tive value of 422,400 eu­ros was sold for 154,906 eu­ros in April. The com­mer­cial value of the same prop­erty in 2008 was 563,200 eu­ros.

Mar­ket prices are typ­i­cally 40 to 70 per­cent be­low the ob­jec­tive val­ues, and go­ing rates may be hard to in­cor­po­rate into the au­to­matic sys­tem, given also the rar­ity of trans­ac­tions nowa­days.

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