“Stupor” in the real estate market: what has been revealed "electronic real estate identification"

Tens of thousands of property owners across the country found themselves in a “stupor” due to the introduction of electronic identification of real estate, which must now necessarily accompany every transaction: purchase and sale, inheritance, change of horizontal ownership and even refusal of usufruct.

At least 35,000 property cases are pending

According to the Greek Notaries Association, there are currently at least 35,000 pending real estate transfer cases, inheritance or for other reasons that cannot be completed.

“We estimate that each of our 3,500 offices nationwide must handle between 5 and 15 of these cases, which are often pending for months.”, says Georgios Rouskas, President of the Union of Notaries of Greece. Of course, many thousands of other cases involving the sale of real estate and the transfer of parental rights have been thwarted due to their complexity. In fact, the problem seems to be growing as more and more cases become available.

According to the relevant law, which came into full force from April 2022, every transaction of sale or parental provision of real estate and, in general, every transaction changing the proprietary right to real estate, must be accompanied by the issuance of a building identification card. This is a digital file that contains all the individual elements and documents describing the property, such as the building permit, certificate of structural vulnerability, title deeds, floor plans, graph paper and any statements of affiliation with laws suspending the imposition of fines on unauthorized the buildings. Confirmation of the correctness of these data must be verified by a competent engineer by comparison with the existing condition of the property.

As it turned out, the institutionalization of this measure brought to the surface all the pathologies of building construction in the country, almost from the very beginning of the Greek state, fully confirming the popular saying: “there is not a single piece of real estate in Greece that is not arbitrary or illegal.” In most cases, there are discrepancies and errors in the accounting of real estate objects, ranging from insignificant, for example, 1-2 sq.m. between the establishment of horizontal ownership or the floor plan and the current state of the property, to the arbitrariness of entire areas that are specified differently in contracts and when establishing horizontal ownership than in reality.

It is estimated that there are at least 35,000 property cases pending, whether for transfer, parental provision or other reasons, with no way to close them.

According to Mr. Ruskas, Even if the property does not have an arbitrary status, it takes about two months to issue a building certificate.

“First step is the submission of an application for planning permission to the relevant planning authority. This usually takes at least two months. If no problems arise, then, for example, the sale or granting of parental rights occurs,” notes Ruskas. But if errors arise, for example, when registering surfaces, then a real calvary begins for the owner, lasting up to a year. And there are also such cases, when a solution cannot be found and the property ends up being completely worthless because the owner is unable to transfer it.

Indeed, in many cases the owners, often heirs, are unaware of the existence of problems with their property. One of the most common cases concerns a discrepancy between the approved plans held by the planning authority and those submitted by the developer to the notary, on the basis of which the deed establishing the horizontal properties for the floor was drawn up. This act of determination was used in the sale of apartments, as a result of which discrepancies between the actual areas and those indicated in the building permit are very common. This problem is almost universal in apartment buildings built with the 1950s, 1960s and 1970s in mind, i.e. 50-70 years ago.

If the discrepancy in area also affects part of the total area of ​​​​an apartment building or neighboring apartments on the same floor, then changing the composition of horizontal real estate units also requires the consent of other owners, which entails very large costs and even more time. For example, in many cases, the owners of neighboring properties have died or are permanently abroad, and other owners refuse to participate in such a process, which makes it impossible to issue a passport for the building, and the owner is not able to use his property.

As you can understand, this problem is widespread and even affects the normal functioning of the real estate market, especially the sale and purchase of residential real estate, since it puts thousands of apartments out of service. This removes valuable real estate from the balance of supply and demand at a time when there is a large shortage of housing for sale. That is, sales prices are constantly inflated, and those who are interested in buying a home find themselves in a dead end, without even an alternative in the form of rent, the prices of which have also risen sharply in recent years.

Of course, as long as such problems exist, government statements about “completion of real estate transactions in 2-3 days” by creating special digital platforms look like a bad joke.

Gazebos, barbecues and destroyed permits
Tens of thousands of cases where property cannot be transferred due to the identity of buildings have certainly caused the intervention of the relevant authorities. POMIDA (Panhellenic Federation of Real Estate Owners), in cooperation with the Greek Association of Notaries, has prepared a proposal for legislative regulation of a number of cases in order to facilitate transactions that are easier to resolve.

For example, in cases where the variations in square footage are very small, flexibility should be allowed. At the same time, as POMIDA emphasizes in its recent public speech, it proposes to the competent Ministry of Environment and Energy to adopt a provision according to which “every co-owner of a horizontal property in an apartment building can unilaterally correct the exact actual area and breakdown of his property by notarization , for whatever reason a discrepancy may arise, by unilaterally amending the act establishing horizontal ownership in an apartment building, without, of course, affecting the mileage of the plot and other proportions, rights and obligations of other co-owners.” It is also proposed that every owner of independent property may unilaterally correct the exact actual area and shape of his property by unilaterally correcting the deed by which he acquired it.

According to Mr. Ruskas, it is also necessary to provide for the possibility of subsequent extensions to the property, if they are not of a permanent nature and, of course, provided that they do not affect the general areas of the building or other neighboring properties. “We have cases where gazebos, canopies and even built-in barbecues are arbitrarily permitted,” he says. Such actions could be eliminated so that notarial actions are completed faster and citizens do not experience inconvenience.

POMIDA and notaries have developed a proposal to legislate a number of “simple” cases to facilitate transactions.

Of course, this situation also puts a lot of pressure on the engineers, who have to resolve impasses that arise, often under pressure from the owners, who risk losing hundreds of thousands of euros due to the cancellation of the deal. The frustration is even greater in cases where the owner does not accept any responsibility, for example if a building planning permission file is lost or destroyed due to the negligence of the local planning authority.

According to TEI President George Stasinos, the process of digitizing city planning department records will begin soon, a project that is estimated to be completed in about two years from today. Of course, even in this case there is no solution to the loss or destruction of the relevant documents, since they simply do not exist to be digitized.

As noted by engineers, in such cases it should be made mandatory (for example, in the form of a circular or a ministerial decision) to obtain a certificate of loss of the file from the competent urban planning authority. This provision exists in law, but many departments do not apply it in practice, which leads to an increase in problems.

Sale, rental, legal registration and support of real estate in Corinthia from the company “Greece Home Invest“.

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