Is it just me, or can you also not open Facebook, Instagram or any other social network you belong to without running into an ad from a company marketing apartments in Greece?
This week I happened to attend a conference dealing with real estate and Israeli real estate investors in Greece. The conference was well produced. It is important to note that Greece is a tourist country and in 2024 more than 35 million tourists visited it, and it lacks hotel rooms (mainly in Athens). In 2024 real estate prices in Athens rose by about 10%, but it is still possible to find apartments there at prices that Tel Aviv residents can only dream of. I have no doubt that the proximity to Greece as well as the “sane” real estate prices compared with Israel are a source of interest for many investors. Real estate taxation in Greece is friendlier and simpler than taxation in Israel, but the significant incentive to invest in Greece is a tax treaty between Israel and Greece which provides that an Israeli resident does not have to pay tax in Israel on his income from a real estate investment in Greece, but only in Greece!
So for those who don't yet know, the purchase tax in Greece is at a rate of 3.09% of the property's price (unlike the purchase tax in Israel (mas rechisha), which is by brackets if this is the first apartment, or 8% if it is an investment apartment).
Capital gains tax is at a rate of 15%, but the Greek tax authorities have issued a temporary suspension of the payment of capital gains tax (the directive on the suspension for someone selling up to 3 apartments is extended from time to time). In practice, this means that investors are not obligated to pay tax on capital gains from a property in Greece, and as a result, given the wording of the treaty between Israel and Greece, the Israeli investor will not be required to pay tax in Israel either on the profit from the sale.
The tax on rental income in Greece is at a rate of 15% up to income of 12,000 euros a year, and if income exceeds this amount the tax is at a rate of 35% on the excess up to annual rental income of 35,000 euros and 45% on income above that amount.
At the same time, it is important to mention that over the past year the Greek government has been trying to tighten the steps of real estate investors as a result of internal problems stemming from the housing shortage for locals in the big cities. If in 2023 someone who bought a property worth 250,000 euros could receive a Greek “Golden Visa,” today the threshold in the main cities has been raised to 800,000 euros. In addition, the Greek government is making it harder to rent properties short-term and seeks to reduce the number of apartments offered for rent on a daily basis.
In addition to the many advantages mentioned, it is important to note several critical recommendations for real estate investors in Greece:
- Define your investment goals and your investment horizon.
- Carry out comprehensive due diligence (legal, financial and physical) on the property before the purchase.
- Pay attention to changes in building and rental regulations in Greece and make sure the property you are buying suits your purpose (it is important to check all the licensing requirements and approvals for the property).
- Use local professionals.
- Don't skimp. Get on a plane to Greece and go to the property you are buying. Walk around the neighborhood. Get to know it before the purchase and make sure that the property and its surroundings are as you were promised.
With professional advice and careful planning, you can maximize your real estate investment potential in Greece.
Stories are based on real situations, with identifying details changed. Not legal advice.
Translated from the Hebrew original. עברית