Purchasing Property in Kefalonia
As Greece is a member of the European Community, all E.U citizens are permitted
to own property on Kefalonia.
For non-E.U. citizens the situation is slightly different. You will need to
either form a Greek or E.U. registered company to hold the title of the
property, or apply for permission.
As in most European countries, to assist you with the purchase of your property
you will need to engage the services of a lawyer, who will check the title and
ensure there are no outstanding charges against the property, and f you are
purchasing building land you will need a professional surveyor to confirm what
may be built.
We can assist you with the appointment of lawyer, surveyor, architect, and any
other professionals whose services may be required.
When you have negotiated a purchase price for the property, the usual procedure
is as follows:
A pre-contract is prepared and signed by both parties. This commits both buyer
and seller to a price and a date (usually within 60 days) for completion of the
sale. During the period between signing the pre-contract and completion, the
purchaser’s lawyer will check that clear title exists in the property, and that
there are no outstanding charges (for example mortgages, taxes, etc.). In the
case of a building plot, he will confirm that building is permitted. Where
additional consents are required (for example, from the Forestry Commission)
these will also be obtained during this period.
At the time of signing the Pre-contract the buyer pays an agreed deposit which
is usually about 10% of the purchase price. This deposit (less handling charges)
is refundable in the event that the purchaser’s lawyer is unable satisfy himself
with respect to the issues mentioned above. However, should the buyer wish to
cancel the sale for any other reason, the deposit is forfeit.
As the purchaser, you will need to obtain a Greek tax number (AFM - pronounced
“AhFeeMee”), and we can assist you with this. You will also appoint a lawyer
and, if necessary a surveyor. As mentioned, we can assist you with these
appointments. The lawyer will appoint a public notary who will prepare the
necessary Final Contract.
The day before signing the Final Contract, a tax declaration is signed and the
amount of tax shown becomes payable. This is Transfer tax payable to the
Government. The amount of this tax is calculated on the value of the property as
assessed by the Tax Office, which is usually lower than the actual purchase
price. Either the buyer's lawyer or the public notary effects this payment. It
is therefore necessary to have funds easily available to make this payment at
least a week before the date that the final contract is signed.
Signature of the Final Contract takes place in the office of the public notary.
The presence of the buyer is necessary unless he has appointed someone with
power of attorney to act on their behalf. Once the sale has been completed, the
notary registers it with the Land Registry, who retains a copy of the Final
Contract. The notary, who will supply certified copies to the buyer, also
retains a copy.
For budgeting purposes, you should bear in mind that you will need to find the
following addition sums over and above the agreed purchase price of the property
(these are approximate figures to give you a guideline):
- Transfer tax. 7% of the first 14,673 € and 9% of the remainder, based on the Tax
Office valuation as mentioned above.
- Public notary. 2.2% to 2.5% of the tax assessed value depending on the value of
the transaction (including subsequent registration fees).
- Buyer's lawyer. 1% - 1.5% of sale price (depending on the value of the
transaction).
- Estate Agency Fee. 2% of sale price plus VAT at 18% (of the 2% fee!).
