My Place In Zakynthos Homepage

Update 24/06/10

Doesn't look as though we will be out there this year
unfortunately, but thought I'd try and keep posting some
updates from time to time for those with a passing interest.

I'm a little fustrated that we are no closer to financing
our project and very concious that the build permissions
expire at the end of next year. I've no idea if they can be
extended.
Realisticly I'm feeling we didn't think this through enough.
I cannot afford a second mortgage, particularly in the
current financial climate.

I have been wondering if I were to put a business plan
together on the basis of renting the villa out if I could
secure the funds that way. Not that i've ever done one before.
Other alternatives would be offer a partnership, keep the
land and wait or simply sell the land! I'd be interested if
anyone has any other suggestions?

I'll keep doing the lottery in the meantime!

My place in Zakynthos is about sharing the experiences
and progress regarding our project to build our own 'off
plan' villa on the beautiful Greek island of Zakynthos. The
trials and tribulations, such that anyone else thinking of
doing the same has some insight in to the complexities.

This details our progress .....

Back in October 2005, for my 40th birthday, my family (me,
wife, 4 kids + friend and in-laws) visited Zakynthos for the first
time. We had a truly fantastic time on a very beautiful and
picturesque island. We love the place and given the
depressing situation regarding UK pensions and mortgages
we felt building a villa in Zakynthos would be a good long
term investment with the potential for winter sun, rental or
possible retirement.

To purchase land with a view to build you need to consider
the following (these are shown in the sequence we have
done them thus far):-

1) Tax Number
This can be obtained from the tax office in Zante near the
harbour. It's not uncommon for the tax office officials to be
a little bureaucratic. If you're uncertain then see if you
can get a Greek speaking friend or acquaintance to go
with you. We were aided in this way by via Dave Henderson
(Zante Property), who arranged for Gianis Mavrias, a local
builder & hotel owner, (www.Zanteview.gr) to go with us. Despite Gianis throwing his briefcase across the room and
shouting, everything went very well. The following day we
were able to collect our official tax numbers.

2) Bank Account
After getting a Tax Number you can open a bank account
locally. Get one that does remote internet banking (and most
do) but always remember to get the "pink slips" for each
transfer made into the account from the UK. This can be
offset against the tax hit if you sell the land/property, so very
important to get & keep these as they prove the origin of the
money (i.e. not laundered money). Also, consider using a
specialist transfer company for funds transfer from the UK to
Greece and not a bank as they tend to charge and the rates
aren't as good. These are very easy to setup with the likes of
Excel Currencies or HIFX.

3) Power of Attorney (POA)
A POA is only required if you need someone to act on your
behalf locally in Zakynthos because you cannot be there in
person. In our case we decided on the plot of land we wanted
in one of our visits. So to setup a POA requires a visit to the
Notary office and for cost of €200 we were able to get Yainnis
(Terra-Nostra) to be our POA.

4) Topography
A topography shows the boundaries of the plot, dimensions,
area(sqm), compass orientation, distance from the sea,
situation relative to the village boundary and other relevant
details. While there was an existing topography we were
advised to get a new topography by Yiannis, at a cost to us of
€400. This was done prior to completion of the land sale in
case the plot fell outside the village boundary. This is crucial
to show the relative boundaries of the land, very important
in our case where the village boundary dissects the plot. If
the plot is outside the boundary then 4000 square meters
(4 strema?) is required for build. If within the village
boundary then our plot of 551 sqm is absolutely fine for
our 130 sqm villa and a pool.

5) Land Purchase Completed
Took a little while. I believe this required our POA, our
solicitor (appointed by our POA) and land owner at the Notary
Public Office to complete. This is followed by our POA
registering the transaction with the equivalent of the Land
Registry Office. The land has an objective price (OV) and a
commercial price (CV) which is what you actually pay for the land.
Tax is paid on the OV price not the CV which is usually less.
See our example below: -

Commercial Value (CV) € 28,000.00
Objective Value (OV) € 18,000.00

Costs: -
First €15,000 of OV price @ 9% tax € 1,350.00
Remainder of OV price (i.e. €3000) @ 11% tax € 330.00
Lawyer 1.5% of OV price € 270.00
Notoriety 1.5% of OV price € 270.00
Land Registry 0.25% of OV price € 45.00
POA - (Yainnis) fee 2% of CV price € 560.00
New Topography € 400.00
Total Costs € 3,225.00

Total of Purchase + Costs = € 31,225.00

6) Building Permissions.
Once you have purchased the land you can consider the build.
The cost of building licenses were set to increase significantly
after February 2007, so we were fortunate to have our plans
registered prior to this date. Obviously you need to know the
kind of property you want to build, layout, number of
bedrooms etc. We had seen a very nice stone villa done via
Yainnis so I based our design on that but increased the
bedrooms to 3, with a bedroom on the ground floor should be
decide to rent the property out. Before you submit plans you
need to consider the end result. Zakynthos is an active
earthquake zone and building regs are designed to ensure
substantial build strength so fabrication can be metal frame,
reinforced concrete or a hybrid. During our first visit we
experienced a 6.0 earthquake - quite frightening at the time
having never experienced one before, but having said that my
in-laws didn't notice a thing as they walked down to
the Old Vineyard restaurant we were at. George
the owner ran outside, not sure if that was for effect or
genuine fear !! (very nice restaurant, near Planos very
close to the Carvel hotel).

7) Annual Land Return to the Tax Office.
We only found this out on our latest visit (July 2009) and
as a result will incur a fine (€75 per year) for the 2 years
we have not made a return to the tax office. As land owners
this must be done annually and is a statement about the land
and contents. This is best done via an accountant (another
€75) but this is the only annual cost from then on in this respect.

Following our trip in July 2009 we stayed at a private
villa (Graceland) in Lithakia thanks to the owners Paula & Alan.
It is a lovely villa with private pool and stunning views over
Lagana bay and the island of Pelouzo.
During our visit we were able to discuss our potential build,
obtain approximate build costs and get copies of the
permissions and actual villa plans.

We now have to consider the financing aspects!!

Regards
Mark
August 2009