How to purchase property in Cyprus
1.Finding the ideal property
Much information is readily available from magazines and Internet websites advertising properties for sale in Cyprus; it is very easy to get an idea of what type of property is available and at what cost before you actually start your search.
There are many ways to search for properties: estate agents, property magazines and web sites.
When using a local agent, make sure they are well versed with the local market.
Cyprus XYZ have over ten years experience of the Cypriot market and of prices, locations and investment oppertunities.
Think carefully about the location and type of the property depending on whether you plan for it to be your main residence, second home, holiday home to be let out on occasion or a property to be let as an investment for the future.
Make a list of the important elements - the purchase price, the overall size and number of rooms, would you prefer a garden, terrace or balcony, etc - it will keep you and your estate agent on the right track to find your ideal property.
The type of property and its condition is also an important consideration.
Buying to renovate or build a new property demands careful pre-planning.
Planning consent and building approval will be required.
You will need the advice of an expert - an architect or surveyor.
2. Purchasing the property
Once you have found a property that is suitable discuss with the agent what offer might be appropriate and ask them to tell the vendor your offer.
Once an offer has been accepted by the vendor, you will be required to pay a reservation fee.
When the reservation fee has been paid the property will be immediately withdrawn from sale, thus giving you peace of mind until your lawyer is ready.
This reservation fee should be paid to the agent or developer, rather than to a private vendor.
You will now have up to 28 days to do all your searches and surveys and appoint a lawyer to do the legal checks and prepare and agree a contract.
Your lawyer will check the title to the property to ensure that you will own what you are buying, free from mortgage, and with building license.
Cyprus XYZ will help you with this entire process and if required, reccomend a suitable lawyer.
3. The Sale Contract
The buyer's lawyer will normally prepare the contract of sale in English, before signing it do check that all the details and conditions are correct, such as:
· Details and identities of the vendor and yourself (the purchaser)
· A full description of the property
· The surface area of the property and land
4. Completion day
You will have arranged a date for completion to take place.
It is your responsibility to ensure you have the mortgage funds from the lender.
Once you know the date you will be completing on your property purchase you will need to make sure that you have a bank account open and funds are being transferred into it in time for the completion date and arrange for buildings insurance to be on risk from the date of completion.
You may also wish to insure the contents of the property and if you have a mortgage to consider Life Insurance.
Property in Cyprus is Freehold.
You own the property and the land it stands on absolutely.
This applies to houses and flats (in the case of flats you own a share of the land.)
Title deeds will be issued in your name after you have obtained the Council of Ministers consent.
For Europeans this is only a formality now (EU law prohibits discrimination).
For citizens of other countries this can take 6 months to obtain, but is usually granted.
Your lawyer will apply on your behalf.
When the title deed is issued to you, you will pay Transfer Tax calculated as 3% on first CYP 50,000; 5% on next CYP 50,000 and 8% on the remainder.
If buying in joint names each person has the tax on their ½ share.
5. The professionals involved with property purchase
As soon as you start thinking about buying a property in Cyprus you are going to need professionals who will help and advise you.
* The Property Consultant
Property Consultants are usually local to an area and therefore will normally only have properties for sale within that area.
In the case of Cyprus XYZ our property consultants have years of experience within most areas of Southern Cyprus and we have on our books many off plan projects, apartments, villas and land right across the Island.
Cyprus Xyz always set out to obtain the best possible price for the property, land, etc.
A good property consultant will do their homework and find out what price the vendor will accept.
They should also be able to give you an estimation of all the other fees and the property charges you will be responsible for when you are the owner.
* The lawyer
The lawyer is a private individual suitably qualified to advise on legal matters in Cyprus.
The purchaser is free to choose their own lawyer, and will be responsible for their fees which more often than not are negotiable.
Cyprus XYZ can recommend reputuble Cypriot lawyers that we have dealt with over a number of years and have proven to be reliable, efficient and cost effective.
* Architects and surveyors
An architect or surveyor should be considered if you are thinking of purchasing an older property or one that you want to renovate.
They will have experience with planning and obtaining necessary permissions and certificates, and be able to give an estimation of the cost.
They should also know of reputable builders who are registered as such and who have their own insurances to cover their work.
Property taxes and related topics
There are only small taxes on residential property.
The local authorities, the Municipality, collects Municipal Tax which covers the costs of refuse collection and street lighting and is normally about CYP 60.00 per year.
There is also an annual Property tax collected by the District authority.
These taxes are assessed according to the assessed value of the property in 1980 and only apply to property valued in excess of CYP 100,000 at that date.
Most property is therefore exempt.
Communal Charges (maintenance charges)
For those owning property such as an apartment within a complex where there are common facilities there are maintenance and service charges to pay.
You should consider these charges before signing any contract.
The charges will vary according to the size and quality of the complex, whether there are lifts, swimming pool, gardens, tennis courts and other facilities.
· The purchase price, and how and when it will be paid
· Details of any fixtures and fittings included in the sale
Note: There are no let out clauses. This is a binding contract
On the day of signing the Sale contract you will be required to pay your deposit to the vendor.
This could be just the reservation fee already paid by you, the buyer.
Once you have signed the Contract of Sale, the clock starts ticking.
You have got a set date by when you should complete on the purchase.
This is normally 28 days but can be longer or shorter by agreement.
In the case of property under construction there will be a schedule of payment dates following the usual 40% deposit on signing. Â
IMPORTANT: The contents of this report have been compiled in good faith by Cyprusxyz to provide assistance to investors, but do not constitute investment advice or recommendations. Investors should not rely upon the information given in order to choose types or routes of investment but should make their own independent enquiries before making choices. Cyprusxyz has taken reasonable care in researching and presenting the information herein but makes no representations as to its accuracy and accepts no liability for actions taken or not taken as a result.
