Making Sense of Cyprus Property Sales

Cyprus property sales are in many ways different to buying real estate in other parts of Europe even the U.K. Athough Cyprus and Britain have very similar legal systems there are some stark contrast when it comes down to the nitty gritty of buying that dream villa or luxury apartment. There will be plenty of legal professions on hand when you decide to actually get involved in Cyprus property sales but an overview of how the home buying and selling is done on the Island should prove useful. Like the saying goes “forewarned is forearmed” and you can never really have too much information.

The most glaring differences appertaining to real estate in Cyprus is how and when buyers are expected to pay for their property. In the U.K. you pay a few hundred pounds to the builder to reserve your plot or house followed by 10% of the total price. Then once and only once the house or apartment is completed you are expected to complete the purchase by paying the outstanding balance via your loan or mortgage. All of this is of course would be handled by both your own and the builders solicitors who work together to ensure that all the funds change hands on one given day.

Cyprus property sales work rather differently in so much as the buyer will be expected to pay the developer a large proportion of the cost before the house or villa is finished. In most cases you will be expected to put down a reservation fee of anything upwards of cyp2000 which usually secures the property for thirty days. After this time you are most likely to be contracted to paying the Cyprus developer around 30% of the total cost of the property. Failure to proceed to this point (dependent upon the contract) may see the builder reliving you of the holding fee as a none refundable deposit so check the contract if you are considering withdrawing your offer to buy.

Once the buyer of the Cyprus property has paid the first 30% the rest of the money will become due at various phases of the build such as completion of the shell, plastering and final finishes. Again, it is a good idea to scrutinize your contract because many of the Cyprus developers will insert penalty clauses for any late payments of these outstanding amounts in the form of interest. Many of these developers in Cyprus property sales will encourage you to pay them directly but you may prefer that all moneys be sent via your Cyprus solicitor. This way the solicitor will only release your funds to the developer when they are sure that the building work is at the agreed stage. The other advantage of using this method is that you will have the benefit of a third party keeping account of how and when the funds were paid over.

The other big difference with Cyprus property sales is the whole matter of the title deeds. Unlike the U.K you are unlikely to receive any deeds for your new build property when you pay for it. This is where the contract between yourself and the Cyprus property developer comes into play. Apart from detailing all the specifications of your new villa or apartment it is also your document of ownership in leu of the title deeds. The reason this situation occours lies in how the land is transferred to the developer in the first place. The land acquired by the developer will come with one title deed for the whole plot and will remain in force until the project is complete. Then the developer applies to the planning authorities for separate deeds as per the original construction plans.

The process of acquiring separate title deeds for new build Cyprus property can take up to seven years or longer and there will be a cost too. At the time of writing this article the deed tax on an average Cyprus villa was working out at around cyp6000 so you should take it into account when buying. Although these differences may appear a little strange to foreign buyers it has worked well this way on the Island for many years. There may be other subtle differences when buying or selling on the Island but the great news is that there is no shortage of English speaking experts available to help you make sense of Cyprus property sales.



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