Over time, real estate has been one of the major sources of revenue for the state budget. The real estate was the magnet of the naughty tax collection measures of the respective government during the memorandum years, because the relevant taxes are theoretically easy and collectible.
The once coveted good for the Greek has been besieged with taxes that increased 700% according to an OECD survey for the period 2009-2018, at a time when most member states recorded a reduction or stabilization in the tax imposed on real estate. In our country, taxation skyrocketed, as revenues from 0.3% of GDP in 2009, a decade later (year 2018) reached 2.1% of GDP.
Greece is now one of the most expensive countries in real estate and land tax among the OECD countries. It now ranks 5th in a row after Canada, the United Kingdom, the United States and France.
Revenues from property taxes:
In 2010 the State received € 487 million from property taxation
In 2011, property taxes reached € 1.17 billion
In 2012, property taxes amounted to € 2.75 billion
In 2013, property taxes increased further and amounted to € 2.991 billion
In 2014, property taxes broke the € 3 billion barrier
In 2015, property taxes amounted to € 3.18 billion
In 2016, property taxes amounted to € 3.53 billion
In 2017, property taxes amounted to € 3.60 billion
In 2018, property taxes amounted to € 3.217 billion
Budget 2019: From the regular real estate taxes, revenues of € 2,760 billion were expected to be collected, of which € 2,711 billion. from the single Property Tax (ENFIA)
Budget 2020: Regular real estate taxes were expected to collect € 2.829 billion in revenue, of which € 2.705 billion. from the single Property Tax (ENFIA)
Budget 2021: Regular real estate taxes are expected to collect revenues of € 2.804 billion, of which € 2.751 billion. from the single Property Tax (ENFIA)
The declared income of property owners:
In 2010, the declared income from real estate amounted to € 8.87 billion
In 2011 the declared income decreased to € 7.98 billion (1,584,059 taxpayers had real estate income)
In 2012, real estate income amounted to € 6.8 billion.
In 2013, declared income decreased to € 6.22 billion
In 2014, the declared income was reduced to € 6.08 billion
In 2015, declared income fell to € 6.05 billion.
In 2016 the declared income from was € 6.107 billion.
In 2017, the declared income was € 6.19 billion
The tax burdens imposed on real estate within 5 years:
Solidarity contribution rates increased with the maximum rate increasing from 2.8% to 10%. Rental income is subject to a solidarity contribution.
Rental rates for rental income have increased. The rate for income up to € 12,000 increased from 11% to € 15%, for income from € 12,000 to € 35,000 increased from 33% to € 35% and for income over € 35,000 increased from 33% to 45%.
Short-term housing leases (eg Airbnb) were taxed.
The rates of the supplementary ENFIA increased from 0.1 to 1% to up to 1.15%, but the tax began to be imposed from a lower value as the tax-free amount was reduced from 300,000 to € 200,000. In 2018, the tax-free amount increased to € 250,000.
The rates for the calculation of ENFIA in the plots were increased.
In 2016, the additional ENFIA for legal entities increased from 5 thousand to 5.5 thousand. While for the defined NPDD and NPID µ Non-profit, as well as the Real Estate Investment Societes Anonymes the same rate increased from 2.5 ‰ to 3.5 ‰.
Increase in the objective values of real estate in about 4,000 areas of the country leading ENFIA to higher levels with the aim of expanding the tax base as many areas outside the plan are located in expensive places.
Foreign direct investment in the real estate market in the pre-covid-19 era:
The year 2019 was the fourth consecutive year of increase in net foreign direct investment in our country, after the annual increase of 9.0% from 2017 to 2018, by 23.5% from 2016 to 2017 and by 118.5% from in 2015 to 2016. Therefore, based on the balance of payments data in 2019, the real estate market sector was responsible for 35% of foreign direct investment made last year in the Greek economy, which amounted to 4.2 billion . euro.
According to the Bank of Greece, real estate purchases by foreigners have skyrocketed in recent years, as they have increased 6.5 times compared to 2016. It is characteristic that in 2016, the relevant amount had not exceeded 222.4 million . €, before reaching € 414.7 million in 2017, € 1.128 billion in 2018 and € 1.45 billion in 2019.
In the first quarter of 2019, the inflows of foreign capital aimed at the acquisition of real estate amounted to € 419.3 million, down 9.6% compared to the corresponding quarter of 2018, when they had reached € 464.1 million.
This decline was recorded due to the wait-and-see attitude of many interested investors in view of the measures to stimulate the real estate market announced by the government.
The Greek real estate market before the coronavirus pandemic had changed its page after about 10 years of continuous recession, recording an increase in sales prices throughout the country. Even in the midst of a pandemic, sales prices in 2020, according to a recent BoG report, increased by 4.2% compared to an increase of 7.2% in 2019.
The real estate market is a key pillar of development of the Greek economy
The real estate market is a key pillar of the development of the Greek economy, a realistic tax reform is now required and a national and long-term plan for the approach of investment funds.
A plan that will adapt to international challenges at any given time. There are examples, such as Portugal, which in the midst of a pandemic had losses of only 5% in 2020 in the golden visa program, when our country counts losses of 95% compared to 2019.
The correct recording of objective values is a development measure for both the real estate market and the Greek economy. It is a constant demand of the real estate market to create an information system that will follow the trends in the real estate market, which according to recent statements of the government’s financial staff is part of the second reform effort that will be replaced by modernizing the system of objective determination of property value. the term objective value with commercial.
The simplification – the automation of the required procedures for the transfer of real estate is a key factor for our country to join the mature markets and to attract investments.
In 2020, according to the latest annual report of the World Bank for the ease of doing business, Greece is in 156th place among 190 countries, as it is still required to collect 11 different documents and certificates for the purchase and sale of a property. In the corresponding report of the World Bank for 2019, our country was in 153rd place.
According to the above, additional fiscal space will be created to further reduce real estate taxation. The real estate market can make a decisive contribution to the sustainable development of our country, while it is directly connected with more than 3,000 professions.