The ins and outs of buying a home in Cyprus, including legislation, pitfalls to avoid, expenses, and the actual procedure in both North and South Cyprus.
For many people, owning a home in the sun is a dream, and Cyprus is an ideal location to realize that desire. Purchasing a home in Cyprus, on the other hand, necessitates extensive research and planning.
Our guide on buying a home in Cyprus will explain the procedure and what you can do to avoid any problems.
Purchasing a home in South Cyprus
South Cyprus is a member of the European Union, which makes it more economically stable, more expensive, and more popular with the world community because it offers chances to do business with the EU.
Purchasing a home in Cyprus
In Paphos, Cyprus, a typical residential complex. As is customary, proximity to the sea has an impact on the pricing.
Is it possible for foreigners to purchase property in South Cyprus?
Foreign nationals can buy property in southern Cyprus without any restrictions, but they must apply to the Council of Ministers for authorization to do so.
Most applications are approved in most cases, however the paperwork can take a long time. You can sign a sales contract and even register it with the Land Registry Office, but you won’t be able to acquire your title documents until you get authorization from the Council of Ministers.
To be cautious, include a language in your sale contract that protects your interests in the unusual event that you are denied permission to purchase.
Purchasing a home in Cyprus following the Brexit vote
Citizens of the United Kingdom can buy a home in Cyprus under the same rules and regulations as non-EU residents.
There are some limitations on the size of the plot of land you can buy and the amount of time you can stay in your Cyprus property without becoming a resident.
Without a visa, you can stay in any EU member state for three months out of every six months. If you want to stay longer, you will need to get permission.
Your parcel of land should not be larger than 4,014 square meters.
Obtaining a mortgage might be difficult, therefore it’s best to work with a reliable foreign broker.
Is it safe to invest in real estate in Cyprus?
It’s safe if you do your homework and know what you’re doing. Here is a list of precautions to follow while buying a home in Cyprus to prevent potential pitfalls:
- Always check to see if the land is mortgaged.
- Employ the services of a reputable agency.
- If you’re buying off-the-plan, have a look at any properties that have previously been completed by a developer.
- Plan ahead of time to ensure you’re aware of the standards you can expect;
- Make certain you are aware of how your property will be cared for.
- Make sure your lawyer isn’t affiliated with the developer, vendor, or real estate agent in any way.
When buying a home in Cyprus, do I need to hire a lawyer?
Before purchasing a home, it is highly suggested that you hire a lawyer who is familiar with all of the complications of paperwork and, most crucially, hunting down the property’s title deed.
Mortgages on land or property are frequently taken out by developers. If you sign a deal with one of these developers and they go bankrupt, you will most likely be responsible for the mortgage. Many buyers in southern Cyprus have been affected, and it has been a horrible experience for those who have been affected.
Check with your lawyer to see if there are any mortgages on the property. Remember that if you sign a contract for a property in Cyprus that includes a financial claim or a mortgage, you will not be able to get the deeds in your name until the mortgage is paid off, so proceed with caution.
Make sure your lawyer isn’t also representing the selling side (a private vendor or a developer), as this is a typical occurrence and may be quite risky in terms of ensuring your best interests are protected.
Check access to utilities and services, as well as if you will be able to develop/improve the property in accordance with local planning laws, if you are buying a home in Cyprus that requires renovation.
Purchasing a home in Cyprus
Pissouri village, Limassol District, has several stunning luxury villas.
When buying a house, there is a legal process that must be followed
Make an offer to the present owner through your realtor when you find the home you want to buy.
If both parties agree, a formal contract of sale is drafted in writing and translated into all essential languages. It must then be deposited with the appropriate District Lands Office within two months after both parties’ signatures.
A deposit of roughly 10% of the transaction price is normally required from the buyer.
The title deed, on the other hand, can only be lawfully transferred if the government has granted the necessary approvals and the imported monies have been validated. The property will then be registered in the name of the new owner by the estate agent or lawyer.
What is the cost of purchasing a home in Cyprus?
You should budget at least 15% extra for transfer costs, stamp duties, and legal fees on top of the purchase price. The agent’s fees are normally paid by the seller.
Transfer fees vary depending on the value of the property and can range from 3% to 8%.
The cost of a property also influences stamp duty. It can range between 0.15 and 0.20 percent, however it should not exceed 20,000 EUR.
Purchasing a home in North Cyprus
Purchasing property in North Cyprus can appear to be a really good deal. North Cyprus is the #1 destination for finest beachside buying in 2021, according to Forbes.
However, it is strongly advised that you rent first to familiarize yourself with the area and the peculiarities of the real estate market before making a purchase.
Is it safe to invest in real estate in North Cyprus?
In recent years, there have been certain legal reforms in the North Cyprus property market that have made purchasing a house in the TRNC considerably safer. Nonetheless, doing your own research and understanding the process is critical. A good estate agent is also a necessary component of the transaction.
Here are a few pointers to keep in mind when looking for a home in North Cyprus:
Rather than getting enticed by an off-plan offer, you should look at pre-built stock that is either being sold as a resale or that has been completed on an already completed and inhabited site.
First and foremost, rent! Why not rent a home in Cyprus to get a feel for the place first? Also, to determine if you’d be willing to make a long-term commitment to the island. After all, purchasing real estate is a long-term commitment.
Furthermore, there is an ongoing dispute between Greek Cypriots in southern Cyprus and Turkish Cypriots in northern Cyprus regarding who owns the land on which property is built on both sides of the island.
Before the 1974 conflict, for example, the property on which Larnaca International Airport is now built belonged to a Turkish Cypriot family.
Following the end of hostilities and the island’s division, Turkish Cypriots occupied all of the territory in the north, while Greek Cypriots occupied all of the land in the south. Generations later, the question of who owns which land is still being debated.
As a foreigner, you may have no desire to become engaged in this internal strife because it is truly none of your concern. Rent or buy a residence with the “correct sort” of irrefutable title deeds in this scenario.
Is it possible for foreigners to purchase property in North Cyprus?
Foreigners intending to buy property in North Cyprus are limited to one property or one donum of land per person (1,338sq meters or 14,400 sq ft). This restriction does not apply when purchasing property with a foreign or Turkish title.
To purchase a property, you must first obtain authorization from the Council of Ministry, which is currently a relatively simple process.
If you wish to acquire many houses as an investment, you’ll need to consider a trust and will almost certainly want professional assistance.
The Different Types of Title Deeds
In North Cyprus, there are various forms of title documents used to sell land and property, some of which are more desirable than others.
Property or land owned by Turks or Turkish Cypriots prior to the 1974 partition of Cyprus is sold with a Turkish title. Foreign Title refers to property that was previously owned by foreigners (Europeans or other nationals) prior to 1974.
Both titles are well-known around the world.
The TRNC Title (Kesin Tasarruf Belgesi – Absolute Possession Document) covers properties and lands handed to Turkish Cypriot refugees as compensation for land of comparable size and value that they lost in the south following the 1974 conflict.
Property and lands protected by TRNC Title may be subject to compensation claims from former Greek Cypriot owners if the two sides of the island ever establish a political accord based on the United Nations’ Annan Plan.
However, compensation will almost certainly be based on pre-1974 valuations and will be low, particularly if the properties in question were abandoned or used for grazing before to 1974.
On such land, the majority of new developments in the TRNC take place.
TDM Title, also known as “Turk Mali Degil” or “Not Turkish Title,” refers to land that was primarily owned by Greek Cypriots prior to 1974 and then handed to Turkish settlers after 1975. Buying a house with TDM Title might be a risky proposition.
Legal process and extra costs when buying a property in North Cyprus
Purchasing a property in the TRNC is a relatively simple process. In most cases, two lawyers are involved in the transaction — one from the seller and one from the buyer.
The price is agreed upon between the buyer and the seller, and the contract is drawn up in English. The agreement specifies the agreed-upon price, completion date, and any other terms of sale. The buyer is expected to put down a 10% deposit at this time.
The buyer’s lawyer then applies to the Council of Ministers for permission to acquire the property on the buyer’s behalf. When the permit is received, the buyer pays the balance of the price, and the vendor signs the transfer of all property rights into the buyer’s name. The transaction has now been completed.
Make sure to account for 3% stamp duty and a minimum of £1,000 in solicitor’s fees.
Property purchases in North Cyprus are subject to a 5% tax.