The Sunday Times - Property
The Sunday Times, July 23, 2006
A slow boat to Paxos
It’s not the easiest place to get to, but this tiny Greek island is attracting British buyers, discovers Helen Davies
Throwing back the green-painted shutters, Elizabeth Speller floods her home with Mediterranean sunlight and the scent of orange and lemon trees. The stone house, half- hidden in olive groves high up in the hills of Paxos, is one of 100 or so properties on the Greek island owned by Britons.
Barely seven miles long by three miles, with its pleated hills of dense cypress trees that sink into the sea, Paxos has become an increasingly attractive haven for buyers looking not just for a house in the sun, but one where they can also become part of a village way of life.
Speller, 53, a Cambridge academic and author of travel guides to Athens and Rome, has chosen to “live up with the Greeks”. This time last year she bought a “squalid” two-bedroom house near Petratakis, a 10-minute car ride from the pretty harbour of Loggos, for £120,000. She spent the winter throwing away rusty fridges and dirty mattresses found in the overgrown garden, unearthing a valuable oil painting that now decorates the whitewashed walls of the open-plan living room.
“I could never afford to buy anything in England for this money,” says Speller, who owns a three-bed cottage in Gloucestershire. She has set aside £25,000 to renovate the house and plans to reinstate windows on the lower ground floor to create a study where, if broadband arrives as promised on the island next year, she will spend a couple of months a year writing.
Still a “work in progress”, the 120-year-old house is slowly becoming home. The books are piling up on the shelves, a hammock has been slung up in the shade, the Habitat flat-pack furniture is unpacked and a bath (a rare treat on the island) has been installed. Speller has also shipped out an upright piano, in desperate need of tuning. But, most of all, it is home, because the locals now know the house as Elizabeth’s Villa.
This local stamp of approval is what life as an incoming homeowner on Paxos is all about. “The island is so unspoilt and enchanting,” says Speller. “It is reassuring to feel like you fit in. It’s not about building grand villas and adding swimming pools. I don’t think a pool would be right.”
Getting to Paxos can be something of an odyssey. There is no airport, and although the seaplane (£24 for a single ticket) from Corfu, the nearest airport, has cut the travelling time to 15 minutes compared with the 30-minute hydrofoil or the 90-minute car ferry, it is tricky to link up flights with the forward journey and advisable to call to check timetables. There are direct flights to Corfu in the high season (from May to August), but most of the year you have to fly via Athens. My own journey from London Heathrow took 19 hours including a stopover in the Greek capital.
Paxos has only two hotels and a single disco that opens in August, in contrast to the heavy development on nearby Corfu, where McDonald’s, Starbucks and water parks are taking over.
“We used to go on holiday to Corfu a lot, but I wouldn’t buy there now,” says Julia Daniels, 62, who after inheriting some money following the death of her mother, bought a three-bed villa on Paxos in May last year. At £270,000, the villa at Amfitriti was double her budget, so she appealed to a friend. Daniels, who works at Panache, a second-hand designer clothes shop in Tunbridge Wells, Kent, had no difficulty in persuading Anthony Wegner, 47, to be a silent partner. They would each pay half, Daniels would oversee any redecoration and Wegner would organise letting the villa to provide an income.
“I was in despair,” says Daniels, who started looking for a house in 2004. “I couldn’t find anything, not a cottage to renovate or a plot of land. But now I can sit on the terrace looking at the sunset, with a glass of wine, and I know I made the right decision.”
There are now five estate agencies on the island — the same number as taxi drivers. Three of them have set up in the past five years to cater for the growing demand from British and Italian buyers. The Italians tend to head south of Gaios, the largest village on the island, which has a population of about 2,500, while Britons look northwards to the sleepy harbour at Loggos and the slightly more hip Lakka.
Land and property prices in Greece have been rising at an average of 10% a year since 1995, but local agents estimate the rate of increase in certain parts of Paxos has been three times that.
While some British buyers, such as Speller, are keen to restore old houses, others are looking to build their own home. “Prices for land have doubled in the past five years,” says Dawn Marie Jones, a sales agent with JM Property, who warns that some vendors put the price up every season to test the resolve and wallet of keen international buyers. “More and more British buyers are turning their backs on restoring old property and choosing a plot to build a house. They are more confident and know what they want.”
JM Property is selling the last two plots with planning permits above Loggos harbour for £172,000. It offers a project management service, charging 12% of total project costs, to oversee the building process.
Graham Simpson, founder of the holiday company Simply Travel, chairman of Watford football club and non-executive director of Simpson Travel, bought a villa on the island’s rugged west coast in 1999. He paid a “substantial” amount for the four- bedroom property, the Eagle’s Nest, that he estimates has since doubled in value.
Simpson, 59, went into partnership with Tassos Zenembissis, an Athenian businessman, and set up Paxos Property Company in 2003. The first three villas are nearing completion and will go on sale in September, but he has yet to set a price. The stone houses, with three bedrooms, three bathrooms and a private swimming pool, are in the centre of the island, near Magazia, with sea views.
Simpson, who has also bought an old Venetian manor house and 15 acres just outside Lakka, says: “I’m passionate about keeping Paxos as it is. I don’t want to bastardise the island. Paxos will develop whether you like it or not, but we’d like to go about it in a fairly upmarket way. It can never be like Corfu.”
Spyros Bogdanos, the pony-tailed mayor of Paxos, is also keen to avoid mass development. “Many of the British buyers have bought older houses to restore in Paxiot style. That’s good for us,” he says. “We prefer the Paxiot tradition, in stone with red tiles and green or brown details, not the blue and white of some of the other islands. Paxos can never be like Corfu. It is another place, another mentality. Anyway, it is difficult to build more houses.”
It is on average about 30% more expensive to build on Paxos than on Corfu, at £1,025 per sq m, due to the high cost of importing building materials. The island’s building rules are strict and buyers should be aware of what they can and cannot build — otherwise they may find themselves owning land but unable to build anything.
In simple terms, if you buy within a village boundary, you can build on up to 70% of the plot; if you buy 500m from the boundary, you need a minimum 2,000sq m plot to build a house up to 250sq m; while in rural areas you will need at least 4,000sq m to build a similarly sized house.
Buyers are advised to employ an English-speaking lawyer to carry out all the necessary checks and searches on the title of a property and the relevant planning permissions. A few unfortunate British couples now find themselves embroiled in legal disputes in the Greek courts over land they have paid for but do not legally own. The vendor did not consult their extended family and so, it is argued, had no right to sell the land.
Rental demand for holiday villas on Paxos is strong. Like many owners, Simpson chooses to take advantage of the market and lets his villa for six weeks in July and August. Due to the high cost of building on the island, he earns less than 5% on his money, however.
“It’s more of a lifestyle investment,” he says. “The rents should cover the costs of running the property, the garden, maintaining the pool and paying the maid.”
Chris Griffiths, founder of Paxos Property Agency, advises Britons to buy the best land and view they can afford and then build a simple Paxiot house. A two- or three-bedroom villa is easier to let than four bedrooms as the holiday market is dominated by couples.
“Underpinned by a solid tourism industry and protected from overdevelopment, Greece is one of the best investments in the Mediterranean,” Griffiths says. “Three years ago, I never thought that we could sell a house for £70,000. Now plots of land regularly sell for more than £170,000.”
One owner who has watched this growing demand and the subsequent rising prices on Paxos with interest is Jane Walker, 55, an interior designer from Newbury in Berkshire. She helped restore a ruined olive press, bought for £2,000 in 1979, into a two-bedroom home that has since been the mainstay of her family holidays.
She has reluctantly put the Old Olive Press, 10 minutes from Gaios, on the market for £80,000, to pay school fees. She has no intention of cutting ties with Paxos, however. “I just fell in love with the island,” says Walker. “It is still so unspoilt and unutterably Greek.”
On the market
On the way to Ozias, a 15-minute drive south of Gaios harbour, this stone villa has two bedrooms and two one-bed guest flats. There is a terrace and barbecue area. It is for sale for £515,000 with JM Property, 00 30 266 203 1175, www.jmproperty.com
This three-bedroom villa near Arvanitakika has sea views. It comes with 2,000sq m of land but no swimming pool and is for sale for £413,000
Overlooking the pretty harbour of Loggos and less than a five-minute walk from the village, this 2,500sq m wooded plot comes with a permit to build a 250sq m villa. It is for sale for £172,000 with JM Property, 00 30 266 203 1175, www.jmproperty.com
Above Glyfada beach, a 20-minute walk from Loggos, with views of Corfu, this 3,200sq m plot, covered in olive trees, has a permit to build a 200sq m house. It is for sale for £110,000
Julia Daniels’s villa is available to let at £500-£1,500 per week through www.villapaxos.com
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