As real estate sales prices rose despite the pandemic, aligning fair values with commercial prices and expanding the fair system to 3,000 new areas became an exercise for powerful rescuers.
At the Ministry of Finance, a special group leading changes to the objective value map goes through a sieve and estimates the zonal prices for each municipality and settlement proposed by private property appraisers and compares them with data from the real estate transfer value register and leases.
The relevant process has advanced to a great extent, but in several areas there are large discrepancies in the prices proposed by the appraisers, resulting in more difficulties in completing the project. For example, in Attica, problems concern areas such as New Philadelphia and Paleo Faliro, while problems in the rest of the country have been reported in Etoloakarnania, Achaia, Salamis, Aegina, Kythira and Lemnos. Real estate appraisers are expected to propose a 30%, 50% and even 100% increase in some areas.
The largest proposed increase is in central Athens, which has benefited significantly from increased demand over the past five years due to the boom in Airbnb. The proposed increases are on average 50% – 60%. In the northern suburbs, the proposed increases are smaller, averaging between 20% and 30%. The increases are also significant in the southern suburbs of Attica, which have been favored both by increased demand for housing by foreign investors and by Ellinik’s work. Accordingly, a large increase is proposed in the neighborhoods of the western suburbs.
According to the current market picture, the areas where fair values will be in the red, especially those where the gap between objective and commercial remains open even after the last price adjustment in the area in June 2018. Thus, the “candidate” for increasing fair values are:
- Districts of central Athens such as Koukaki, Exarchia, Kypseli, Kolonaki, Patisia, Ampelokipi and Pagrati.
- Southern suburban areas. In the coastal area of Glyfada, Voula, Vouliagmeni and Elliniko, they record the highest real estate sales prices, but also large differences between commercial and objective values.
- Piraeus and the suburbs of Attica. Higher area prices will cover many suburbs of the basin, such as Maroussi, Holargos, Chalandri, as well as Piraeus and many so-called popular neighborhoods in Korydallos, Egale and Peristeri.
- Areas of Thessaloniki where real estate sales prices remain high.
- 3,000 areas outside the target system. These are areas and settlements that, although included in the construction plan, have been impartially determined for many years, and the result is that the tax value is determined by local tax offices on the basis of so-called comparative data. As a result, luxury villas located in areas – fillets in Mykonos, Santorini, Paros and Portocheli – are taxed moderately only because they are located in settlements where there are no area prices.
“A dual task is currently underway: adjusting fair values to commercial values and expanding the tax base by including new areas in the fair value system,” Finance Minister Christos Staikouras (Sky) said yesterday, adding that this exercise is significantly hampered by prolonging the health crisis and travel restrictions. “If this task is completed in time and fiscal space emerges,” then, as he said, “it is possible that in 2021 we will have a reduction in ENFIA among beneficiaries, especially those with small and medium-sized real estate.”