Cyprus Properties Buying Guide

Compared to many other countries, the process of purchasing properties in Cyprus by non-residents is very simple.

It is advisable to seek advice from a solicitor on the purchase of your property. Their duties will be to do the necessary searches on the property, check the contracts (and draw them up in some cases), and complete the ‘Specific Performance’ and Council Of Ministers application. By law in Cyprus, all registered estate agents must do searches on their properties and must inform clients on any legal encumbrances or problems related to the property. Legal fees are likely to be in the region of €1000 for a normal transaction

Once you’ve seen a property you like, as in the UK you make an offer via the agent. If it’s accepted, now is the time to hire an independent lawyer, preferably with experience of conveyancing for overseas clients. The British High Commission in Nicosia has a list of lawyers within Cyprus who can advise in English. 

Then you must apply for permission to own a Cyprus Property from the Council of Ministers. This can be done by you or your lawyer can do it for you. It’s not necessary to obtain this before you buy the property however you need to get it at some point. You will need the agreement in order to sell the property on.

Property Inspection. The cost of a survey is inexpensive. If you neglect to get a survey and the house falls apart later, it’s your responsibility and your cost to pay. New properties have a lifetime guarantee for major structural problems; however you have to prove negligence. And anything minor has a 1 year guarantee. For the most part, the only time you really need to get a survey is when the property is old and may have structural problems. Your lawyer will be able to put you in touch with a good surveyor.

The next stage is to pay a reservation or holding deposit - usually around €1,700-€3,400. This will take the property off the market, usually for around three to four weeks. This reservation deposit can count towards the purchase price but is normally non-refundable if you simply change your mind about going ahead. If for any reason the vendors pull out, you should get your deposit back. After the reservation deposit is paid, the lawyer will start doing the relevant searches on the property, gather all the necessary documentation and start drafting the contract. It is highly advisable to have a survey done, particularly with a resale property. Your lawyer should be able to arrange this via a member of the Cyprus Valuers Association.

The reservation deposit gives you only three to four weeks’ grace to get your finance in place. This isn’t long, so you’ll find this stage far less stressful if you start securing finance before you even make your offer. If all the searches are completed satisfactorily and finance is in place, the next major stage is signing the contracts. Upon signing, a payment of 20-30 per cent of the purchase price is made to the vendors. The remainder is paid on delivery or, if the property is still being built, stage payments are required until completion.

The contract, once duly signed and stamped, must be deposited at the Land Registry office within 60 days. This is done by your lawyer and this measure prevents any seller from re-selling their property to anyone else, hence safeguarding the buyer until the Council Of Ministers application has been made and approved. It is vital that you ensure your lawyer does this in time and that the land is then registered in your name. 

The signed contracts are taken to the Inland Revenue department to be stamped, where stamp duty is paid. The rate is a very reasonable 0.15 per cent for the first €170,860 of a property’s price, then 0.2 per cent for amounts over €170, 860.

After contracts have been stamped by the Inland Revenue, they are sent to the Land Registry. Cyprus has a very advanced land registration system. However, you won’t get your title deeds until well after you own the property – sometimes not until several years later. This is nothing to be concerned about. When the new title deeds with your name on them are available, you’ll be charged a one-off transfer fee. It is three per cent of the sale price up to €85,430; five per cent for properties between €85,430-€170, 860 and eight per cent above that. If the property is bought jointly, the tax is reduced

A final contract is prepared and once you’ve signed it, the balance of the payment is made (unless you’re buying off-plan and continuing to make stage payments, as laid out in your contract).

Stamp Duty is Payable. The tax is due within 30 days of signing the Sale Agreement This is at the rate of 2.57 euros per 1,710 and thereafter at the rate of 3.42 euros per thousand thereafter (note: numbers are a bit odd due to the fact that when the Cypriot Pound was in circulation, it was£1.50 per £1,000 and £2.00 thereafter. After the Sale Agreement is filed with Land Registry your lawyer will then apply for the transfer of the Title of the property.

There are various ways to reduce your VAT bill (of 15 per cent) when you buy property. If you’re a resident of Cyprus and the property is going to be your sole residence, you can get a rebate of ten per cent. Buildings with a planning permit submitted before May 2004 are VAT exempt

When the terms of the Sale Agreement have been met you can take possession of the property.