Land Transfer Tax Reduction Draws Luxury Buyers to Rhodes

Land Transfer Tax Reduction Draws Luxury Buyers to Rhodes

Residential News » Europe Residential News Edition | By WPJ Staff | March 24, 2014 10:09 AM ET

According to global real estate firm Engel & Volkers, Rhodes is enjoying new record luxury home prices in the first quarter of 2014.

The market for luxurious and high-end holiday properties on Rhodes is currently undergoing a period of growth. After considerable fluctuations on the Greek property market resulting from the Euro crisis, Engel & Völkers has been registering a continuous rise in inquiries for prestigious residential property since 2013. The high level of demand is sending prices soaring. "Last year we managed to broker a house for the record price of 13,000 euros per square metre," reported Georg Petras, Managing Partner of Engel & Völkers Rhodes.

These market development, amongst other factors, to general worldwide uncertainty resulting from the instability of stock markets and many people's wish to invest in stable tangible assets as a result. The reduction of land transfer tax from 10 to 3 percent, which came into force on 1 January 2014, favors this trend. "We have registered a 30 percent rise in the number of search customers for exclusive homes in desirable locations," said Mr. Petras. Availability of premium property on the sunshine isle is limited however. "The market for residential homes on Rhodes continues to be impacted by a low number of new building developments, which have only begun to increase in number again since 2013," said Mr. Petras. Another contributory factor is the restricted number of existing prestigious properties in good and very good locations, due to the natural limitations of Rhodes being an island. Buyers of holiday homes and luxury property are usually wealthy foreigners or Greeks living abroad who, in many cases, acquire their property with little or no borrowed capital at all.
Buyers take advantage of opportunity to make attractive investments
The majority international buyers currently dominating the market originate from Germany, the UK, Austria, Switzerland, Belgium and non-EU states. Non-EU citizens buying a property worth 250,000 euros or more now receive a five-year residency permit that can be extended as many times as they wish. Georg Petras is therefore expecting a rise in demand, especially from buyers based in the Middle East and Russia. The property expert anticipates a continuation of the prices rises in 2014, based on the increase in the number of inquiries over recent months and the increase in sale transactions. "Real estate in Greece is a good in- vestment prospect once again as the bottom of the market in terms of property prices has passed and buyers are now being rewarded with high potential for appreciation in the value of their new homes," said Mr. Petras.
The most sought-after locations for second homes are Lindos and the surrounding region with the resorts of Pefkos and Vlicha, as well as the entire east coast stretching down to the south. Most desirable are prestigious properties on the coast with direct access to the sea or a magnificent outlook. There is particularly high interest in villas, attractively positioned houses of all sizes, traditional captain's cottages, as well as townhouses and penthouse apartments. Generally speaking, larger houses with three of more bedrooms and top-quality fittings are in most on trend at present.

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