The exit from the memorandums of understanding and the return of the economy to positive growth rates were accompanied by a huge rise in the real estate market. This matter, as is natural, prompted the state to take a series of measures, which on the one hand make life easier for property owners and those wishing to own real estate, and on the other hand create conditions of tax justice for those who exploit real estate, in the face of traditional players in the market.
There is no doubt that 2024 is the year in which a lot will change in this area and real estate owners must be well aware of the obligations that will befall them now, so as not to find themselves facing unnecessary unpleasant surprises in the future.
The biggest changes concern those who receive income from short-term rental of three or more houses, as they will have to open books at the tax office where they will now be considered entrepreneurs and VAT will be charged.
One significant change in the direction of reducing paperwork and making property transfers easier is the digital property transfer file
Anyone who plans to buy a property must know that paying the price must be made through a bank account, otherwise the contracts are considered invalid if paid in cash.
Meanwhile, property owners who insured their homes against natural disasters will see a 10% reduction in their new ENFIA bill, while those who repair or renovate their homes will receive a tax deduction of €3,200 per year for five years.
Another important change in the direction of reducing paperwork and facilitating the transfer of real estate is the start of the digital real estate transfer file at the beginning of the year. This is a new service from gov.gr that unifies and simplifies the procedures for transferring ownership of registered real estate.
Property map
Let us see in detail what are the changes in the current real estate tax map:
1. Real estate transfersPaying the purchase and sale price of real estate in cash, partially or completely, is no longer valid. Those who wish to purchase a property must pay the full price via bank payment. Otherwise, the contract or private document recording the advance payment or partial or full payment in cash will be void and its transfer will be prohibited, while violators will be subject to strict fines of up to 500 thousand euros.
2. Short term leases: 141,452 properties owned by 102,422 natural persons will be subject to pass-through tax and environmental tax, while more than 7,000 taxpayers who own three or more properties will be required to start a business by paying insurance contributions, business tax and VAT from the first property.
There is no doubt that 2024 is the year in which a lot will change in real estate
3. Huge finesSevere penalties are imposed for failure to register in the short-term rental real estate registry. Real estate managers are subject to an annual independent administrative fine, equivalent to 50% of the total income of the tax year in which the violation was committed, which cannot be less than 5,000 euros. After a violation is discovered, the short-term rental property manager must take necessary compliance actions within 15 calendar days.
4. Rental term: There is a maximum of 60 days for the duration of a lease to be counted as short-term. The 60 day limit applies to the term of each individual lease.
5. Discounts for renewal: A tax deduction of up to €3,200 per year will be available for five years to taxpayers who proceed to repair or renovate their property from January 1, 2024. The income tax deduction can be up to €16,000, which is evenly distributed over five years. In this case, for a business worth €16,000, taxpayers will receive a tax deduction of €3,200 per year for five years. In addition to the work that reduces the tax, expenses for purchasing goods are also included, provided that they do not exceed 1/3 of the amount of expenses for receiving services, which are taken into account to reduce the tax.
6. Reduce envia: For more than a million properties, a 10% ENFIA discount is provided, provided that they are insured against natural disasters (fire, earthquake, flood).
Other interventions
At the same time, other real estate-related interventions and changes have been ongoing since the beginning of the year.
especially:
1. Digital folder: The digital ownership transfer file has been in operation since the beginning of the year. This is a new service from gov.gr that unifies and simplifies the procedures for transferring ownership of registered real estate. Those citizens and notaries who use the transfer file via https://akinita.gov.gr will receive a transfer (or justified rejection) within one business day instead of a months-long delay. The conditions for “One Day Transfer” are, firstly, that there is no previous title outstanding on the same property, and secondly, that the fees be paid by credit/debit card.
2. Modify data: Amended transfer tax returns are now filed electronically through the myProperty platform. This procedure frees property owners from time-consuming visits, in most cases, to the DOY declaration that has been submitted through the AADE myPROPERTY application and the relevant notarial document has not been prepared.
Property values
Almost two years after the new zonal rates were implemented across the country, data from the Real Estate Transfer Registry reveal that the gap between objective and commercial values has widened in many regions, with the biggest differences in central Athens, the northern and southern suburbs of Attica, Piraeus and Thessaloniki.
According to planning, the new adjustment of objective values through the new automated system of comprehensive real estate evaluation is expected in 2025. By the end of 2024, a new information system will be created that records real estate market trends by collecting data on real estate values and data on their characteristics, and based on this, it will proceed automatically – adjusting objective values of commercial price levels.
Finally, with regard to objective prices, the following is already implemented during the year:
• Area price corrections: The Ministry of Finance is conducting a comprehensive review of applications submitted by about half of the country's municipalities to redefine and reduce the objective values of real estate. The committee is expected to finish reviewing the objections by the end of February. Immediately thereafter, private appraisers will begin work and will proceed to re-establish area values in areas where the Commission finds excessive increases in the objective values applied as of January 1, 2022.
• Expansion of the objective value system: The exercise of expanding the objective system for determining property value in 2,167 regions across the country is in full swing.
• Digitization of prices in off-plan areas: Digitization of areas will be completed for all areas outside the city plan or settlement boundaries, which is the basis for the operation of the automated system of real estate objective values.
Source: Monkey – MEB
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