Question: What’s the lowest price I could pick up a small house – even a one room place – in Crete for? Would I get a mortgage on a small very basic property that is just barely habitable – maybe a beachside property?
Answer: Prices vary from area to area. For instance a ruin in Elounda would cost three times as much as a similar one in a hillside/mountain village 15 kms inland. A beachside property, in whatever condition, provided it would meet legal requirements for renovation into a house, could cost more than a much larger house in land in better condition. If you scan the websites, you will be able to get a good idea of prices. Mortgages are available from Greek banks in Crete, but you need to fulfill the same criteria as you would for a UK mortgage such as providing previous years’ tax forms, proof of how you can make the repayments and so on. The mortgage has to be on a particular property and the bank has to know they will get their money back if you default on payments, so they are not too keen on lending money on ruins and properties requiring a lot of renovation work.
Question: What’s the form on two couples buying a place in Greece together? Would the paperwork be very complex?
Answer: You would have a contract of purchase in all names, so the property would be owned equally in four parts. For the signing of the contract, you should leave a Power of Attorney in each name, for the lawyer to act on each person’s behalf in respect of signing the contract and related matters. A Notary makes the Power of Attorney for you. Make sure you each make a will too, which is drawn up by the Notary too, to confirm what would happen with each part of the property, in the event of any or all of the parties dying.
Question: We would like to buy a small place to run as a b and b – perhaps with just one extra letting room. Since this would be a very small and informal business, do we need to let any authorities know?
Answer: Throughout Greece the law stands that if you are renting out a property, you need declare it at the tax office, because of the income from the rental. A local accountant can assist you with this. If you are renting it out officially as a holiday business and not just having family and friends staying there at your own hospitality, you will not only have to declare it at the tax office, as above, but also apply for approval from the EOT, which is the Greek Tourist Authority.
Question: My dream is to open a very small centre in Crete for yoga and writing holidays. It would be my home, with about four or five paying guests each course. How much red tape do I need to go through and what would you recommend as a venue in Crete, and what type of property?
Answer: A great dream and a lovely idea. There are already companies operating throughout Crete offering yoga and similar alternative holidays and they seem to be becoming more popular.
With this sort of holiday business, you will be able to get a feel for which type of property yourself. Come to Crete and explore the island well, from North to South and from West to East. Each part offers something for everyone. As in the previous question, you will need to declare revenue and an accountant can sort all this out for you. It may be that you have to set up an official business and in this case will have to register it at the Chamber of Commerce, pay national insurance, apply for approval from the EOT and so on. Again an accountant or lawyer can advise you on what is needed and help you through the red tape. Good luck and once you are up and running let us know.
Question: We have recently brought an old stone ruin in Crete, through a local building merchant, who negotiated the deal for us. He is currently renovating the house for us using his own choice of builders. The ruin is 80 m2 and needs total renovation; we have been quoted 50.000 Euros to complete it; is this the sort of price we should be paying? We understand that licenses have to granted, and taxes paid while work is in progress. A lot of work has already been done, but we suspect that no tax or licenses have been paid. As we are not in the country to check plus the fact that we properly wouldn’t get a straight answer from the builders, it leaves us in an awkward situation. Is there any way of finding out ourselves and what will the fines, if any, be for not paying? Finally how would it affect us if we one day come to sell the house? Hope to hear from you shortly, as we will be going to Crete soon to have a look at the work.
Answer: This situation is exactly why you should use a licensed Estate Agent to buy your property and a licensed building company or architect to do the renovation work. You should have been supplied with a written contract for works to be done and their cost. It should also detail what is included (VAT, IKA, building permit, services connections and so on) and what is not included (painting, fixtures and fittings for example).
If a building permit is required, then you should receive a copy of this together with a receipt for its cost. IKA payments (workers’ national insurance) will have to be paid and a final certificate granted by the IKA authority. As the owner of the property, you are responsible for this and if a check is made by IKA you are liable for a fine if you have no IKA receipts and will not be able to re-sell the property without the final IKA certificate or building permit, if applicable.
Please do note that building permit applications can proceed very slowly, so it may have been applied for and not yet received and this is not the builder’s fault.
You may now have to contact the lawyer who drew up your contract (I do
hope you have legal contract drawn up by a notary and signed by lawyer and witnessed by a translator on your behalf) and pay him/her to find out what is going on and to make sure all the papers and receipts are ready for your visit.
Without seeing the property, I am afraid we cannot comment on the cost of
renovation. One other point, it is always wise with these older properties to pay an independent architect to carry out a full survey before you buy, to confirm the condition of the property, whether it is structurally sound, evidence of subsidence and if you want to expand the property, whether it can not only structurally take expansion, but also if it can legally based on the size of its plot.
Question: Our two-bed cottage in Crete will be empty for a fair bit of the year. Then we will have friends and ourselves staying during the summer. What do we do with the small garden that comes with the property? Can you suggest the “right” type of low maintenance plants, is it best to pave it or are there local gardeners who look after bit of land for you?
Answer: If you are in or near a village, I am sure one of your neighbours would be delighted to keep an eye on your plants, vegetables etc. and water them if necessary. Or, there are ex-pats everywhere and so plenty of willing ex-gardeners who would love to get their hands on your garden for you. Just ask around and I am sure you will have plenty of offers! It is in the summer when plants need most attention, what with watering and dead heading. In the winter, they pretty much look after themselves and battle against rain, winds and occasionally snow. The strong will survive. What may be considered weeds in the UK, are beautiful wild flowers here, so do not worry about the garden being tidy and neat. Throughout Crete there are garden centres and smaller plant and flower shops and in my experience the owners are very helpful and will give you good advice as to what would be most suitable for you.