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Revived interest in the private islands

15 July 2012 / 15:07:03  GRReporter
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The traditional summer increase in the interest towards purchasing private islands in Greece, has appeared again in the market this year, especially after the political stability in the country has been restored. Besides, the prices of the islands at the moment are significantly lower than the prices two years ago.

At the same time the recent sale of the Island of Oxeia by the Stamoulis family (Greeks, who live in Australia) to the royal family in Qatar at the price of 5 million euro (instead of the previously requested almost 7 million euro), has encouraged more interested sellers and buyers. It is no secret that a lot of islands are bought for investment purposes, and not because of the prestige or in order to create a small personal paradise, as in the case of Onassis' Island Scorpios.

Oxeia is one of the Echinades, a group of islands in the Ionian Sea, close to Ithaca Island. A large part of the archipelago is Natura protected territory. Nevertheless, according to sources, part of Oxeia can be built-up and it is even supposed that the conditions for construction have already been approved.

An additional reason, that has boosted the market for private islands, is the fact that after the final formation of the financial team of the new government, the agenda again will be the new tax frame and, in particular, the changes in the tax assessments of properties.

Interested buyers know that if they act on time, they will avoid payment of a higher tax, as the increase of the tax assessments in regions, to which the private islands belong, is considered almost certain. Parallel to this, possible buyers will realize direct profits during a future sale, due to the high market price. This argument is used by the sellers of private islands, most of whom are inheritors of the respective property and eagerly want to unburden themselves from the taxes. In this situation, the asking prices have decreased by a minimumof 20% during the last two years, in order to attract more "bold" buyers, bearing in mind that the bureaucracy, related to the possible exploitation/use of a private island, is in full bloom.

The significant number of documents, licences and permits, required for the disposal of such properties, is also the main reason why during the last two years, before the case with Oxeia, not a single private island in Greece has been sold, since buyers very quickly become discouraged.

Tags: private Greek islands sale raised interest direct profits
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