How to buy in Chania
Purchasing a property on Crete is fairly uncomplicated and can be accomplished in a relatively short time, usually 6-8 weeks. After selecting your property, your next step is to appoint a team of professionals who will work on your behalf during the buying process. These are a solicitor, notary public, surveyor and accountant.
Solicitors carry out all necessary legal searches and a property title check for the past 20 years; they also make certain that the property is free of any liens or other legal impediments and that the vendor has paid all past property taxes. Most buyers grant their solicitor Power of Attorney, which enables the solicitor to sign documents in the buyer’s absence.
A notary public is a government-appointed lawyer whose job is to ensure the legal transfer of the property by drawing up and reviewing all official documents. Surveyors, called civil engineers in Greece, verify that planning permissions for all aspects of the construction of the property have been properly obtained and adhered to. An accountant will be able to help you with tax returns and can explain Greece’s taxation laws.
EU nationals do not require any special permission to purchase property in Crete. While a Residence Permit is not required during the purchase procedure, you will need one if you buy a car or apply for a telephone connection.
Next you will need a Tax Registry Number (AFM) which is issued on the spot at the local Tax Office, free of charge. You will need to present your passport and birth certificate. If you have given your solicitor full Power of Attorney, he or she can apply for an AFM on your behalf. Next, with your passport and newly acquired AFM, you will open a Greek bank account, which only takes a few minutes. All payments will be made through this account and it also serves to prove that funds used for buying property purchase are not taxable in Greece, having come in from another country.
You are now ready to sign a purchase agreement, also referred to as a pre-contract. This document is drawn up by a notary and reviewed by your solicitor; it contains the names of the parties, a description of the property, the price, the method of payment and any special conditions negotiable in the purchase process. At this time you will be asked to pay a deposit, usually 10% of the purchase price, to secure the property by removing it from the market.
As soon as the purchase agreement has been signed in front of a notary, your solicitor will carry out title deed searches and ensure that everything is in order with the property being purchased. If the searches highlight any problems you will receive your deposit back in full. If, after you have signed the purchase agreement, you change your mind and decide to withdraw from the purchase, you will lose your deposit. However, if the vendor changes his or her mind, your deposit will be refunded in double.
Once all searches and surveys have been conducted satisfactorily it’s possible to proceed to the final contract. This is signed by the vendor and the buyer, again in the presence of a notary. Alternatively, your solicitor may sign for you if he or she has been granted full Power of Attorney. Upon completion of final contract, all fees and taxes must be paid.
Closing costs paid by the purchaser include the purchase tax which is calculated on the Tax Assessed Value. This is the estimated monetary value of a property according to the Greek tax authorities. As a general rule, a property’s Tax Assessed value is significantly lower than its purchase price. Since January 2014, the purchase tax is 3 %. Other fees include the notary’s fee (2% of purchase price), solicitor’s fee (between 1.5-2% of purchase price) and the real estate agent’s fee (between 2-3% of purchase price).
It is important to work with qualified professionals during every step of your purchase process. This includes using a legally registered real estate agency and professionally licensed builder. If you are in doubt, ask for the qualification papers and licenses they should hold. You can also verify their details with the local Realtors Association or the Chamber of Commerce.