Greece :Trial of the New Building Regulation (NOK 2012), Transitional Provisions, Perspectives and Implications
One of the most important trials of the last decade, which will determine the constitutionality, legality, and application of the main provisions of the New Building Code (NBC2012), began on October 11. The implications of this decision extend beyond the involved parties—the municipalities of Attica, contractors, engineers, and the Ministry of Environment—and impact citizens directly or indirectly, as they too will be affected by the outcome of this critical legal battle. The result of this case will influence not only the rules of construction in urban centers and the trajectory of private construction activity, but also thousands of real estate investments and property transactions, directly affecting citizens’ property, lives, and the country’s overall economic activity. In essence, the legality and fate of thousands of properties built under valid permits from 2012 until today are in question, alongside the validity of tens of thousands of property transactions completed over the last twelve years.
According to information, barring any unexpected developments, a decision is expected by the end of the year, thereby determining the regulatory framework that will set the building rules nationwide and clarifying the legal environment for future market growth.
A crucial question arises: why has such a monumental issue emerged in a state of law that affects both the state and its citizens, and why is it being addressed in this way? Why are some now recalling that the law passed 12 years ago and amended 4 years ago is suddenly deemed harmful to the environment and urban fabric? How is it that, at a time when Greece is said to be building some of its most legally compliant buildings, the legality of these structures is now under scrutiny? Why, after decades of unlicensed construction and successive state efforts to regulate past violations through numerous laws, are certain parties now targeting permits and constructions that have strictly followed the current law?
It is not useful to delve into the specifics of NBC/2012 or the legislator’s intent behind it. While it certainly contains commendable provisions, there are also articles needing improvement and updates. What is essential in a democratic and lawful country is legal certainty and equality among citizens. Every citizen’s right to seek justice when they believe their interests are compromised is inalienable. Equally, however, is every law-abiding citizen’s right to state protection.
As someone familiar with the NBC and its provisions due to my profession, I believe that, like any law, the NBC should be updated regularly to keep pace with evolving needs and developments. Furthermore, transitional provisions should always be provided to protect citizens from abrupt changes that could affect their property and interests.
It is also evident that the contractors, who recently found themselves in the spotlight and are accused of benefiting from the law’s provisions, may be the only professionals among all involved who are least affected. As businesspeople, they would adapt their plans according to any legislation and market conditions, whether under this NBC or another. If the incentives and other contested provisions of the NBC were to be eliminated, they would simply renegotiate with landowners under revised agreements. They could also adjust sales prices or choose alternative locations for their projects. Those involved in real estate would have little to lose as long as any legal change, whether due to a court decision or the need to update the law, occurs smoothly, as in any modern society.
Another overlooked aspect is the significant impact on landowners, who have always been directly affected by the potential development of their plots. The reality is that landowners benefited from the opportunity to further develop their properties, and they stand to lose if that is restricted.
Addressing another dimension—the country’s housing crisis—less construction means reduced supply, and in a high-demand environment, this leads to higher property prices and thus more expensive sales and rents for everyone. Conversely, more construction leads to a higher property supply, creating a more balanced supply-demand dynamic and more stable prices. Contractors can adapt to any situation; however, private property owners and families are naturally less flexible. The housing needs of the country and the best ways to address them constitute a highly significant issue.
It is essential to understand the impact a potential court decision invalidating NBC provisions retroactively would have on tens of thousands of sellers, buyers, property owners, engineers, notaries, building authorities, and employees in every building service. If such a decision were made, every property built in the last twelve years and every related transaction would be rendered uncertain. Every issued permit would be void, every constructed property would be deemed unauthorized, and every transaction invalid. Additionally, confidence in the Greek real estate market would suffer a severe, potentially catastrophic blow, affecting both Greek and foreign investors. The upward trend and investor confidence in Greek real estate, which have developed over recent years after a decade of stagnation, would end, bringing the real estate market back to conditions similar to those of the financial crisis, if not worse.
All parties involved in this dispute must ensure market stability. Legal certainty must be preserved. Regardless of the court’s decision, the state will likely need to legislate soon to align the building code with new realities. The completion of Local Urban Plans across the country will further solidify these updates. However, transitional provisions should be included to allow for smooth implementation, protecting citizens’ property and upholding the rule of law.
The potential for change should not be feared; change brings progress. Both central and decentralized administrations, predominantly elected by and for the people, may differ in their approaches, but they share the common goal of protecting every citizen’s well-being. The framework and rules of any change, whether immediate or eventual, will determine its outcome and overall effect. It is, therefore, vital that any change is implemented smoothly to ensure legal certainty and support the real estate market’s upward trajectory.
Source – Original Read in Greek by Skai.gr
Written by :
Konstantinos Kioleoglou REV
Civil Engineer, N.T.U.A
MEng in Structural Engineering, N.T.U.A.
MSc in Real Estate Investment and Finance, Heriot Watt University
Recognized Expert Real Estate Appraiser and European Valuer ,Tegova
Managing Partner Avakon
Translated with Chat Gpt 4