Repayment of ENFIA in 11 installments, suspension of VAT on property transfers until the end of 2025, measures to limit the Golden Visa, foresees the government’s plan to contain property prices as well as rents.
The above changes were announced at the POMIDA conference by the Minister of National Economy and Finance K. Hatzidakis and the Governor of AADE G. Pitsilis, while the minister announced that the proposal of the owners which provides for a three-year tax exemption from income tax for closed properties with aim for them to “open” and be rented. In the region of Attica, it is estimated that approximately 60-70,000 properties are closed.
The new measures
1. Payment of ENFIA at the end of April with the aim of repaying the tax in 11 installments. As the Governor of AADE said at the POMIDA conference, next week the platform will be opened to reduce the ENFIA for the insured properties. He also stated that the goal for this year is for ENFIA to open a month earlier so that it is paid in 11 installments instead of 10. Specifically from the end of April until February 2025.
2. Mr. Hatzidakis announced that the application of VAT to real estate is being suspended for another year. The suspension of the application of the VAT expires at the end of this year and according to what Mr. Hatzidakis said, it extends until the end of 2025. It is noted that from January 2025 the government has the possibility to limit the VAT on new buildings to either 13%, or for the country to request to join the exemptions for real estate by zeroing out the VAT.
3. Golden Visa Restrictions. Already in Portugal, which is experiencing an explosion in real estate prices, the government proceeded to terminate the Golden Visa program. The interventions of the government are expected to be announced in the near future. It is recalled that from 1/8/2023 onwards the minimum investment limit has been doubled to 500,000 euros in the Central, South and North Sectors of Attica, as well as in Mykonos, Santorini and the Municipality of Thessaloniki, making it more expensive to grant a residence permit for third-party investors countries that want to acquire real estate in these areas.
4. The government evaluates POMIDA’s proposal for closed properties. As Mr. Hatzidakis mentioned: “It is something that we have discussed in the ministry. It is a proposal that cannot be easily rejected. I have given instructions to the relevant services of the Ministry to carry out the relevant studies, so that we can also see based on the data of ELSTAT the actual number of properties and to do a cost-benefit analysis based on these data. In order to be sure of the control and cross-checks we will do, both the actual number of vacant apartments and for all the other parameters. So that the decision we will make is based on more data”.
The POMIDA proposal provides for a three-year exemption from income tax for properties closed in 2023 as well as those that will switch from short-term to long-term leases. In this way, property owners estimate that prices will decrease.