Nine basic changes to the property market
A new taxation bill recently put before Parliament by the ministry of National Economy and Finance introduces important changes in the property market.
According to a ministry announcement, the proposed modifications are aimed at stimulating the property market and generally revivifying the economy, comprising tax reductions, investment incentives and measures to facilitate financial transactions. At the same time the bill confronts long-standing challenges such as the lack of affordable housing, the regulation of short-term rentals and adaptation to the consequences of climate change.
The new framework aims to reduce the tax burden, simplify procedures and bolster the confidence of citizens and investors in the market. With an emphasis on the support of households, the announcement says, the changes constitute a decisive intervention for the creation of a favourable environment in the property market, redefining its role as a lever of economic development.
However, some small changes are to be expected before the bill is voted on, especially as regards the three-year rule for unoccupied apartments, since the Panhellenic Property Owners’ Confederation (POMIDA) has already expressed some objections and has proposed specific changes, which are expected to affect the bill’s final form.
The basic measures
The nine basic measures included in the bill are as follows:
1. Exemption from income tax for properties which were declared empty or were in use as short-term rentals
Properties of up to 120 sq m which had been declared empty or were in use as short-term rentals for the years 2022, 2023, and 2024, will be exempt from income tax. The exemption applies for leases of at least three years’ duration which are signed between 8th September 2024 and 31st December 2025. The measure aims to increase the availability of affordable housing through the long-term rental market.
2. Double reduction of ENFIA for insured properties
From 2025 the reduction in ENFIA is increased from 10% to 20% for dwellings with a taxable value of up to €500,000, on the condition that they are insured against natural disasters such as earthquake, fire and flood.
3. Extension of VAT exemption on new buildings
The exemption from VAT for new buildings is extended to 31st December 2025, stimulating construction activity and making things easier for investors and buyers.
4. Suspension of CGT on property transfers
The suspension of capital gains tax is extended until the end of 2026, facilitating transactions in the property market and attracting new investors.
5. Permanent exemption from ENFIA for listed buildings
A permanent exemption from ENFIA is being introduced for listed buildings with a value of up to €400,000. The measure supports the preservation of cultural heritage, covering the high cost of maintenance of historic buildings.
6. Climate change resilience tax
A resilience tax is being introduced for tourist accommodation, scaled according to the category and season. The income will be used for works of prevention and restoration from natural disasters.
7. Regulation of short-term rentals in Athens
For 2025, the registration of new properties for short-term rental is not allowed in the 1st, 2nd and 3rd municipal units of the Municipality of Athens.
8. Exemption from ENFIA in the municipality of Soufli
Properties in the municipality of Soufli [in Eastern Macedonia, which suffered a major forest fire in 2023] are exempt from ENFIA for the years 2025, 2026 and 2027, supporting the local community and economy.
9. Subsidy programmes for housing and energy upgrades
The “Spiti Mou” (My Home) programme is being extended with housing loans and subsidies for the energy upgrading of properties. The top limit for “I renovate – I rent” is increased from €10,000 to €13,500, now covering 60 per cent of expenses.
The bill, according to the Finance ministry, aims to create a stable and development-friendly fiscal environment. By reducing the tax burden, boosting ownership security and supporting building activity, it aims to revivify market activity. At the same time the new framework responds to the needs of both citizens and investors, creating the prerequisites for a dynamic and sustainable property market.
(Haniotika Nea, 02/12/24)
Source: kolymbaricourier.com
Photo credit: huffingtonpost.gr
