Buying Property in Cyprus
Expats will find that buying property in Cyprus is an investment that is continuing to grow in popularity. In the last decade the island nation has both joined the European Union (EU) and has lifted former bits of legislation that previously discouraged ownership; as a result, many European nationals, namely British citizens, have become home owners (est. over 60,000).Buying property in Cyprus is especially tempting to those retirees looking to spend their twilight years in a sun-soaked climate and prosper from an investment that will appreciate in value.
Where to buy property in Cyprus
In 1974 Turkish troops invaded the north of Cyprus, and since, the nation has been governed by two administrations, Turkish in the North and Greek in the South. Though physical violence no longer exists, there is still a large degree of residual tension that affects even property ownership.
Expats looking to become Cypriot home owners should be wary that many properties in the north of Cyprus belonged to Greek Cypriot refugees who were forced to flee as a result of the division. In many cases title deeds were falsified and documentation is often misleading.
In January 2010 it was ruled that any foreign national that has purchased a property in the Turkish part of Cyprus is liable to be sued by a Greek Cypriot claiming ownership of the home.
It follows that expats should take extra precaution to carry out a pointed title search if planning to purchase property - especially in the North.
Otherwise, both the north and the south boast beautiful properties and each area has the potential to position expats as happy home owners
The purchasing process
EU nationals can buy unlimited amounts of land, but can only purchase one house/apartment; non-EU nationals can purchase the equivalent of one acre of land and one house/apartment.
Getting permission
First and foremost, expats buying property in Cyprus must apply with the Council of Ministers for permission to purchase a home. Though approval is given without too much hassle, the process for obtaining permission can prove both tedious and time-consuming.
Application requires:
- submission of property details
- information about the current owner and contract
- the inclusion of personal history, current resident and financial means of income
It is possible to take over a property while waiting for permission to be granted, but over-eager expats must realize that they risk being denied; at which point a lawyer can advise of further action.
The contract
Expats that have honed in on their future home should put in an offer with the owner of the property. Once negotiated it is necessary to draw up a formal contract of sale. This should be in writing, translated in all languages necessary, and should be deposited with the relevant District Lands Office within two months of being signed by both parties.It is normally expected that those making the purchase put down a deposit of roughly 10% of the sale price.
Transfer of the title deed can only legally be granted once the government has given the appropriate permission and imported foreign funds have been certified. The estate agent or the lawyer then requests registration of the property on behalf of the new owner.
Taxes and fees
Expats buying property in Cyprus will be responsible for transfer fees, stamp duties and any legal levies.
Transfer fees are proportional to the property's market value and are levied according to the following rates:
- Property value up to CYP50,000 - 3%
- CYP50 – 100,000 - 5%
- Over CYP100, 000 - 8%
Expats can expect to pay roughly around CYP1250 for legal services.
Considerations for prior to purchase
Before buying property in Cyprus there are a few absolutes that expats should carry out.
- Ensure the property isn't the subject of an ownership dispute
- Have a broker or another authority source conduct a full examination of the property
- Make an inventory of any necessary repairs or damages
- Check on access to utilities and services, especially if you plan to renovate
