The Greek government is planning changes to the so-called golden visa program extended to foreign nationals investing in property in efforts to make it more attractive.
Potential changes will include lowering the purchase value minimum from 250,000 euros to 200,000 euros as well as allowing for alternative deposit methods. Officials are also examining the possibility of allowing foreign buyers to launch business activities in specific sectors of the economy if the investment exceeds 250,000 euros.
The visa program was aimed at bringing in much-needed cash, but despite being an attractive incentive it has failed to meet the ministry’s expectations. According to the Bank of Greece, capital inflow from the purchase of real estate by foreign investors dropped by 25.6 percent in 2015 to 185.8 million euros, compared to 250 million euros in 2014.
Opposition is citing the lack of trust in the Greek financial system due to ongoing bailout negotiations, the poor promotion of the plan internationally, the inability of potential buyers to get an initial visa to enter the country in order to buy land, the difficulty in setting up a bank account and the overall red tape involving investments.
Launched in July 2013, the program followed the model implemented in Portugal and Spain, where the required investment has been set at 500,000 euros. The Greek visa grants a five-year residence permit renewable for third country nationals who purchase – individually or through a legal entity – property in Greece valued at a minimum of 250,000 euros, or who have taken out a minimum 10-year lease in hotel accommodation or tourism facilities. The residence permit does not foresee a right to employment and citizenship can only be granted after seven years of residency.
Meanwhile, according to PwC’s ‘’Emerging Trends in Real Estate: Europe 2017’’ report, Greece has staved off economic catastrophe for another year, but investors still have a gloomy view of its prospects: Athens is ranked second-from-bottom of the city rankings.
The report quotes a major international investor as saying “there is a risk of Greece dropping out of the Euro, and even if you don’t think it will happen there is still a high potential. It is a spectrum of how much risk you take on.”
Pwc underlines that for there to be a fast recovery of the real estate market, a new regulatory framework, along with measures to facilitate transactions and reduce oversupply are needed.