apartments are safest bet
Plus, 2 April 2010
The tax reform bill being debated in Parliament paints a rather gloomy
outlook for the property market, experts say, arguing that its provisions
introduce new burdens on owners and essentially no breaks that might
have rekindled buying interest.
The category of expensive properties - those valued above 600,000 euros
- will bear the brunt of the new measures as there is bound to be little
buying interest. Areas in which the so-called "objective" values (officially
set minimum rates revised every few years for tax purposes) are above
2,000 euros per square meter will also be seriously hit due to the
lowering of the tax-free ceilings for those who wish to buy new homes
to 200,000 euros and 300,000 euros for single people and families respectively.
The new ceilings will make anyone considering buying a home larger
than 100 sq.m. think again, as they will have to pay a 10 percent tax.
The probable upward revision of objective values in 2011 is considered
critical, as it will affect even more first-home buyers. If for instance,
a single person now buys a house worth 200,000 euros, he or she will
pay no tax. If the objective rate for the zone goes up by 30 percent,
the value of the property will rise to 260,000 euros and its sale will
be subject to a tax of 6,000 euros.
Most interest is expected to be focused on cheap and middle-priced
areas with relatively low objective values and good prospects, such
as Mesogeia and some Athens neighborhoods. Small apartments of 70-100
square meters should be favored, particularly properties that are 3-10
years old and need few or no repairs, as well as older houses that
can realize large capital gains with minimal repairs.
Prospective investors should look for small apartments or studio flats
that have remained unsold for some time, as their prices are least
likely to drop due to the comparatively strong demand.