by Page no: I40
Table of contents
| One Tab | |
(via Nomad Capitalist)
Oversight & Real Estate Lawyer
| Object | Details | |
| Golden Visa | 4-eyes verification of work by Golden Visa Lawyer (only high-level) |
|
| Family | Obtain visa based on Purchase of o | |
| Buyer | 4-eyes verification of who should be | |
Real Estate Purchase |
||
| Flat1: Athens, 125K € | Communication with notarius Complete Verification of object |
|
| Flat2: Athens 125K € | Communication with notarius Complete Verification of object |
|
| (source) | ||
|
Contracting |
Preliminary Contract |
When a property seller and a buyer reach an agreement they can sign a preliminary contract. The preliminary contract is a commitment to sell, a bilateral document signed by both parties in which the seller promises to sell at the agreed price and the buyer promises to buy as soon as the pre-conditions are fulfilled. You need to understand all your obligations and responsibilities, as well as your rights. This is critically important because if the buyer fail to complete the transaction for reasons other than the legal and technical due diligence, this amount is usually forfeited.
|
|
|
Down Payment |
At this stage, a mutually agreed percentage of the purchase price is paid by the buyer to the seller as a down payment. Normally, you will pay a deposit of around 10% of the agreed property purchase price. Should the seller decide not to go ahead with the sale after this has been signed, the buyer’s deposit will be returned – but if the A recent softness in the market has seen exceptions from preliminary contracts but they are still the norm in most cases. In the event that the sale is not completed, if the party responsible is the seller, he/she must pay the buyer double the down payment. If the buyer is the responsible party, he/she loses the down payment.
|
|
Legal Due Diligence |
Lawyer / Notary |
You need to hire an attorney for a property transaction and all real estate property deeds need to be notarised. The appointment of a lawyer is done through a notarial document – power of attorney. A general power of attorney gives broad powers to a lawyer (known as an attorney-in-fact) to act in the behalf of the property buyer. These powers include handling financial and business transactions, settling claims, operating business interests and employing professional help to facilitate your property purchasing process. Having an attorney oversee the transaction ensures that both parties are aware of the applicable legal requirements and all parties are satisfying their duties under the purchase agreement. The lawyer can appear on your behalf in front of the notary and will also verify the accuracy, validity and continuity of the ownership deeds and ensure that all transfer formalities related with the Land Registry Office and/or Cadastre Office are complied with. Do I need a lawyer? |
Legal Procedures
|
|
|
|
Step 1: Engineer Technical Due Diligence |
Site visit by the engineer
(e.g. outside town planning zone) |
An inspection by an engineer is required for the new topographic site plan to be drafted. An engineer needs to check that the property complies with all urban planning and building terms. A technical due diligence is imperative where the property or land in question is located outside the town planning zone or for older properties. Historic and cultural building protection laws envisage a series of strict rules and restrictions. Violation of these rules may result on a complete ban of the structure development. |
| Step 2: Site Plan | Obtain a topographic site plan and a certificate for the absence of non-licensed construction by the engineer | After the inspection in Procedure 1, it is necessary to issue a recent topographic diagram depicting the boundaries of the property (new site plan) sealed and signed by the engineer. The plan shall be submitted to the notary public a few days before the conclusion of the sale contract.
Given that the property has been owned by the seller for 10 years, we may easily assume that the topographic site plan used for the previous transaction (the acquisition of the property by the current seller) is still valid and therefore there is no need for a new topographic site plan. In addition, according to Law No 4178/2013, a certificate from an engineer and a declaration of the seller are needed, stating that there are no illegal constructions or planning offences in the property being sold. |
| Step3: Land Registry Info | Search of information in the Land Registry and preparation of the sale agreement by a lawyer | A lawyer conducts a search of information in the Real Estate office and then prepares the sale agreement. Only lawyers are entitled to conduct a search in the Real Estate Office.
From 1/1/2014 the involvement of lawyers is not required by law but it tends to remain a common practice for transfer of commercial properties. According to the new Lawyer’s Code, the lawyer’s fee is freely agreed with the clients by means of a written agreement. In the absence of such an agreement, the new Lawyer’s Code provides a new schedule of fees which is included as Annex II of the new Code. |
| Step 4: Tax Clearance | Seller obtains tax clearance certificate about the seller and certificate about the Real Estate Unified Tax from the tax authority | The seller should provide a Tax certificate issued by the competent Tax Authority, according to Law 1882/1990 . The certificate assures that the seller has been paying his taxes accordingly. The tax certificate may also be obtained by the notary public.
In addition, since January 2014, a Unified Real Estate Property tax is introduced for the natural person or legal entity that acquires any right over a real estate. In order for the notarial deed of the real estate transfer to be valid, the taxpayer has to provide a tax certificate stating that he/she has paid off |
| Step 5: Seller’s Social Security | Seller obtains a certificate from Social Security Institute | The seller must obtain a certificate of good standing from the Social Security Institute, which assures that the seller (company) has been paying its social security.
Compliance with the Greek Property Law is an essential criterion if you want to buy or sell a property in Greece. |
| Step 6: Property Transfer Tax | Payment of property transfer tax at the Tax Authority | Parties obtain a copy of the declaration made before the Tax Authority competent in the locality of the property verifying that the buyer has paid the property transfer tax. According to Article 11 of L.4223/2013 concerning the Single Property Tax, which replaced the previous provisions of L.3842/2010, the transfer tax imposed on the buyer is 3% of the transfer price of the property.
Furthermore, according to the provisions of the new Income Tax Code (L.4172/2013) any income equal to the added value deriving from a transfer of property (the term “added value” in this case means the difference between the price the seller had paid to obtain the property and the amount he/she receives when selling the same property), is subject to the 15% capital gains tax. According to the provisions of Article 43 of the latest Income Tax Code, if the seller is a natural person, this tax equals to 15% of the above described income from the property transfer. In this case the tax is collected in advance by the notary, who shall pay it to the Tax Authority. If the seller is a legal entity, according to the provisions of Article 58 par. 1 of the new Income Tax Code the legal entity shall include the price of the property transfer at the end of the financial year to its income declaration (which turns the tax payable to income tax rate at 26% |
| Step 7: Sale Agreement | Deliver the draft of the sale agreement to the Bar Association | According to the new Lawyer’s Code of Practice an attorney’s participation at the conclusion of the contract is entirely optional for all contracting parties, irrespective of the value of the contract.
However, this is still a common practice for commercial properties. In the latter case, the draft of the sale agreement is delivered to the Bar Association of the Lawyers. |
| Step 8: Notary and Contracr | A notary public notarizes the sale agreement and prepares the transfer deed | The notary notarizes the sale agreement and prepares the public deed in the presence of the parties and their lawyers, who must also sign. The notary checks up on the documentation which legitimizes the legal representatives of the contracting parties (i.e. Minutes of the Board of Directors regarding the representation of the company published in the Government Gazette, Minutes of the Board of Directors and notarized Power of Attorney regarding the authorization of the contracting party to act on behalf of the company and execute a sale agreement regarding the specific real estate), the ID’s of seller and buyer and attaches to the Public Deed the documentation obtained in the previous Procedures.The documentation includes: (i) Site plan or Cadastral extract, (ii) Declaration of the engineer that the buildings have been built in accordance with the building permit or that any divergence has been legalized, (iii) Sale agreement, (iv) Tax clearance certificate, (v) Certificate that the Real Estate Unified Tax for the last 5 years for the specific property has been paid (vi) Building’s certificate of energy efficiency if required (vii) Social Security certificate (viii) Verification of payment of transfer tax (ix) Copy of the building license. |
|
|
Legal Form |
In order to be valid, this document must be drafted in the same form as the final sales contract and can therefore only be done as a notarised deed (art. 166 of the civil code). Sometimes the parties prefer to sign a down-payment contract in the form of a private deed, but such a document has no specific legal validity, except to prove that a sum of money was paid to a particular person, and the sum can therefore be reclaimed if the transaction is not completed. A real estate transaction is not enforceable on the basis of this type of contract. |
|
|
Payment / Penalties |
The preliminary contract stipulates the sale price. When the preliminary contract is signed, the property buyer hands over to the seller a sum of money, the amount of which is freely set by the two parties. This sum is a down payment and the sale price will be offset by that amount when the final contract is drawn up. The parties may also decide to include a penalty clause, stipulating that if the contract is annulled, an additional sum – to the down payment above – will be paid by the wrongful party to the other party. When is the final contract drawn up? |
|
|
Protection |
Absolutely not. Under the latest Greek real estate law, neither the property seller nor the buyer is entitled to a cooling-off period or right of withdrawal. |
| Step 9: Land Registry Record | The deed is recorded under the name of the buyer at the Land Registry | As per article 369 of the Greek Civil Code, contracts relating to real property (such as a purchase document) must be drafted and executed by and before a notary public. The public deed is delivered to the Real Estate Office to be recorded under the name of the buyer.
At the same time, parties request a property certificate, an ownership certificate, a non-opposition certificate and a records certificate from the Real Estate Office. The transfer of deeds usually takes place during the day of application. |
| Step 10: Cadastre | Registration of the transfer in the Cadastre (ktimatologio) | The transfer is registered in the Cadastre. During this period the Registrar checks the legality of the deeds’ transfer by using the cadastral database. |
|
|
Transfer Tax |