The explosion of the real estate market in recent years brings upheavals and great facilities

The exit from the memorandums and the return of the economy to positive growth rates was accompanied by an explosive rise in the real estate market. This, 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 who want to acquire property, on the other hand create conditions of tax justice for those who exploit real estate, vis-a-vis the traditional market players. 2024 is undoubtedly a year that changes a lot in this area and those who own real estate should be well informed about the obligations they will have now, so that they do not find themselves faced with unnecessary unpleasant surprises in the future.
As APE-MPE underlines, the biggest changes concern those who obtain income from the short-term rental of 3 or more houses, since they will have to open books at the Tax Office as they will now be considered entrepreneurs and will be charged with VAT. Also, those who plan to buy a property should know that the payment of the price must be made through a bank account, since otherwise, with the payment made in cash, the contracts will be considered invalid. At the same time, those property owners who have insured their homes for natural disasters will see a 10% reduction in the new ENFIA bill, while those who repair or renovate their homes will receive a tax deduction of 3,200 euros every year for five years. Also, an important change in the direction of reducing paperwork and making the transfer of real estate easier, the Digital Real Estate Transfer File started operating at the beginning of the year. This is a new service of which, however, unifies and simplifies the procedures for the transfer of land-registered real estate.
Let’s see in detail what changes in the current real estate tax map:

1. Transfers of real estate: The payment of the price for the purchase and sale of real estate, in whole or in part, in cash is no longer valid. Those who want to buy a property should pay the full price by bank payment. Otherwise, the contract or private document recording an advance payment, partial or full payment in cash will be invalid and its transfer will be prohibited, while violators will be subject to strict fines of up to 500,000 euros.

2. Short-term leases: In 141,452 properties belonging to 102,422 natural persons, a transient resident fee and an environmental fee will be imposed, while over 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.

3. Heavy fines: There are severe penalties for not registering in the Short-Term Rental Property Registry. Property managers are subject to an independent administrative fine per year, equal to 50% of the gross income of the tax year in which the violation is committed, which cannot be less than 5,000 euros. From the detection of the violation, the manager of the short-term rental property is obliged to take the necessary compliance actions within 15 calendar days.

4. Lease Duration: There is a limit of 60 days on the duration of the lease in order to count as short term. The 60 day limit applies to the duration of each lease separately.

5. Deductions for renovation: A tax deduction that can reach up to 3,200 euros per year will be available for five years to taxpayers who proceed with the repair or renovation of their properties from January 1, 2024. The income tax deduction can reach up to 16,000 euros, which are distributed equally over five years. In this case, for works amounting to 16,000 euros, taxpayers will have a tax deduction of 3,200 euros per year, for five years. In addition to the works that will reduce the tax, the expenses for the purchase of goods are also included, as long as they do not exceed 1/3 of the amount of expenses for receiving services, which is taken into account for the reduction of the tax.

6. ENFIA reduction: For over 1 million properties, a 10% discount is provided for ENFIA, provided that they are insured against natural disasters (fire, earthquake, floods).

At the same time, there are other interventions and changes related to real estate that have been running since the beginning of the year. Specifically:
1. Digital file: The Digital Real Estate Transfer File has been operating since the beginning of the year. This is a new service of which, however, unifies and simplifies the procedures for the transfer of land-registered real estate. Those citizens and notaries who use the Transfer File via will receive a transfer (or a justified rejection) within one working day instead of months-long delays. The conditions for the “transfer in one day” are, firstly, that there is no previous deed pending on the same property and secondly, that the fees are paid by credit/debit card.
2. Amending returns: Amending transfer tax returns are now submitted electronically through the myProperty platform. The procedure frees property owners from the time-consuming, most often, visits to the D.O.Y. declaration has been submitted through the AADE myPROPERTY application and the relevant notarial document has not been drawn up.
Property Values
Almost two years after the implementation of the new zone prices across the country, data from the Real Estate Transfer Registry reveals that the gap between objective and commercial values ​​has widened in many areas with the biggest differences being found in the center of Athens, the north and the southern suburbs of Attica, Piraeus and Thessaloniki.
According to the planning, in 2025 the new adjustment of the objective values ​​is expected with the new, automated system of mass real estate assessment. By the end of 2024, a new information system will have been set up which will record the trends in the real estate market by gathering data on the values ​​of the properties and data on their characteristics and, based on these, will automatically proceed to readjust the objective values ​​to the levels of commercial prices.
Finally, as far as the objective prices are concerned, already within the year the following are in progress:
• Zone price corrections: The Ministry of Finance is thoroughly reviewing the requests submitted by almost half of the country’s municipalities to re-determine and reduce the objective values ​​of real estate. The committee is expected to complete its review of the objections by the end of February. Immediately after that, the private appraisers will get to work and will proceed to redefine the zone values ​​in the areas for which the commission finds excessive increases in the objective values ​​applicable from January 1, 2022.
• Expansion of the system of objective values: The exercise of expanding the objective system of determining the value of real estate in 2,167 areas throughout the country is in full progress.
• Digitization of prices in areas outside the plan: The digitization of the zones will be completed for all areas outside the city plan or settlement boundaries, which is the basis for the operation of the automatic system of real estate objective values.