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Trends in Greek real estate

The acquistion, development and exploitation of every type of real property in Greece is a major practice area for the law firm. The lawyers at Pantazis & Associates are commerically aware professionals with outstanding legal qualifications and a throrough knowledge of the markets and their mechanics. Their property department has quite a diverse clientele ranging from insitutional investors to high net worth individuals and they have acted in a number of significant projects.

Greece has a very solid system for the acqusition, maintenance and exploitation of legal rights over real property. This is supported by constitutionally entrenched legislation for the protection of foreign investment capital, which inter alia offers favourable tax treatment if the correct formalities are observed.

Save for the usual administrative problems, foreign investors do not face any challenges when acquiring or disposing of commercial or private property. It should be noted however that in the real estate industry, a plethora of unsrupulous "advisors" operate and this often leads to opaque transactions and undue expenses.

The construction sector was and remains one of the basic levers of growth of the Greek economy making up 15% of the country's GDP. The sector includes more than 25,000 participants with a total number of employees approaching 1,000,000. Furhter, it is noteworthy that Greece has one of the highest rates of owner-occupied properties in the world.

Following the booming development of construction and the subsequent rise in the property prices decerase in demand was first observed in 2006. The turning point in the fall of property prices only was the imposition of VAT in 1.1.2006 which resulted in a gradual decrease in property prices only to be exarcebated after the credit crunch in October 2008.

The credit crisis in Greece and the method of dealing with it creates opportunities for future economic growth by liberating and exploiting most of the available production capabilities. Hence, the system will cease to be detached and self powered in the economic downturn whith all the financlian restrictions imposed by the political concurrence.

Although it is hard to predict when prices will reach their lowest levels, it is easy to speculate that investments effected within the next two or three years, will in the medium or long term, certeris paribus, appreciate in value. In certain circumstances if the investment is carefully planned and evaluated against all available and predictable factors, the returns can be remarkable.

This is even more relevant to commercial property and company owned properties particularly in sectors where illiquidity creates exquisite opportunities for prospective purchasers. The same applies to holiday houses, villas and other tourist oriented units where lack of demand is demonstrated by below cost prices.

Although it is hard to assign a date to the nadir of the property market, its current level seems suitable for steady exploitation of the market conditions in order to acquire "distinguished properties" (residential, commercial, plots). Distinguished properties are priviledged properties which always justify a better price and regarldess of the market conditions can immediately be sold to provide for liquid assets.

Leoforos Aleksandras 57, Athens Greece - Tel: 210 2717137 - Fax: 210 2718481