Gov’t admits objective values can’t change now

By Nikos Roussanoglou

With the property market having remained deep in hibernation since the start of the year due to confusion over the capital gains tax, which has led to an inability to complete even the few property transfers that were to take place, sector professionals are unable to point to any positive developments that might stop the price slide this year.

The constant interventions, mostly in the form of taxation, have been discouraging even those who in the last few months had been considering buying a house or apartment in view of the attractive prices, mainly from private sellers. Worse still, sector professionals are now saying that more and more people appear to hold the view that properties, just like cars, are now a permanent source of state revenues to meet the fiscal targets.

This was also implied in a document forwarded to Parliament by Finance Minister Yannis Stournaras this week: Referring to the reasons why the government has not adjusted properties’ so-called objective values (used for tax purposes), to get closer to the actual market rates, he said it is not possible for the time being because the very low number of transactions actually taking place does not allow for the determination of true market rates.

Stournaras added that “as soon as conditions allow for it, the issue of reforming the system to calculate properties’ objective value will be examined, based on availability, proportionality and social and economic criteria, also taking into account the fiscal strength of the state.” It was this last part of the statement that was most revealing, as any revision of objective values that does take place in the future will depend on what the state can afford. It is clear that any reduction in...