New planning law affects west Crete property
West Crete Journal, August 2005

A new planning law has come into force in Greece, which affects land outside village limits, and of course applies to property in west Crete.  It is no longer possible to easily divide large plots of land and build separate houses.  Previously, a plot of (say) 12,000 m2 could be sub-divided into 3 plots of 4,000m2 on each of which could be built up to 200m2, as long as there was an adjacent agricultural or other road giving a frontage of 45 metres.

The new law makes it much more difficult to do this:

▪ the land must be in separate names (in which case it would already be separate plots anyway); joint or percentage ownership by one or several members of a family does not count, unless there is a purchase contract dated prior to 1973.

▪ each piece of sub-divided land must then have 25 metres frontage onto a council-defined road (such as a community road or highway); agricultural roads no longer count.

▪ if the land does not meet these requirements, then it is still possible to build at the same rate of 200m2 per 4,000m2 minus a new deduction of 15% AND the dwellings must touch.  In other words, on our example plot of 12,000m2, you could previously build 3 separate dwellings each of 200m2, totalling 600m2.  The new law means that you can now only build 510m2 and they must be grouped together.

Already we are having to explain to confused land owners who until recently had a financial reserve in the form of a large piece of land, that it cannot now be sub-divided and therefore is too expensive to sell in one piece.

The effect of this will take some time to ripple through the market, however it is obvious that the price of land inside village limits must rise.  The law seems to encourage the building of large grouped buildings in the countryside, an effect we're not sure has been thought through properly by the Greek parliament.

The effect on the price of large pieces of land outside village limits is not yet clear: it must stabilise or even drop a little, however landowners are naturally reluctant to reduce the price of what was until now, their golden nest-egg.

This law is clearly an attempt to reduce the number of high-density small homes being built (mainly for foreign immigrants) in certain areas of Greece, which is already straining the infrastructure (water and electricity supplies, health facilities, roads, sewage disposal, etc.) in those areas.  In our opinion it does nothing of the sort: the developers building these high-density houses will simply group them together, in the form of condominiums.

We would have preferred to see a law that retained the previous 200m2 building limit on a 4,000m2 plot outside village limits, but added the condition that no more than two separate dwelling units could be built there.  This would reduce the pressure on the infrastructure, for example it is not uncommon for developers to build 4 units of 50m2 on such a plot; our suggestion would limit this to 2 units of up to 100m2.

We are waiting to see what happens, but are also discussing these issues with various trade bodies.

Please note that this law does not affect individual plots of 4,000m2 where sub-division is not needed to create them, nor plots previously sub-divided.