Real Estate

Cyprus seems to attract the interest of foreigners from around the world. It is a beautiful island with excellent weather and climate. Its position at the crossroad of three continents, namely Europe, Asia and Africa enables residents to travel easily and cheaply to many other countries. Furthermore, the major tax incentives available to entities registered in Cyprus have made the island a particularly attractive business forum. These are briefly the main reasons behind the increased interest on the part of many foreigners to acquire residential or commercial property in Cyprus.

Our office can guide you through each and every step in the process leading to acquiring property in Cyprus. You can peruse useful relevant information by following the links below:

• Find a property


• Finance the purchase


• Contract of sale and other legalities


• Transfer fees


• Immovable property tax


• Other fees and expenses


• Selling your property


• Inheritance

Find a property

Important: If you are going to use an estate agent, make sure that he is an approved and registered estate agent. Such agents are members of the Cyprus Real Estate Agents Association (CREAA). Your lawyer can verify the legitimacy of your chosen estate agent on your behalf.

Finance the purchase

All major financial institutions in Cyprus offer schemes designed to financially facilitate purchases of property in Cyprus. The exact terms of the offered loans and other facilities depend on several factors including the type and value of the property and often, the nationality of the borrower. Our office has strong relations with some of the major financial institutions in Cyprus and can assist you in obtaining or negotiate on your behalf, financial assistance.

Contract of sale and other legalities

You will be asked to sign a contract of sale with the seller. Most often, such contracts are already drafted standard contracts, which are presented to you for signature. It is of utmost importance that you have your lawyer review the said contract and propose any necessary amendments to it reflecting your particular case before proceeding with signing it. These contracts are often drafted taking into account primarily the interests of the seller.

Apart from that, it is advisable to make a search at the appropriate Land Registry office to verify the seller’s title and right to sell as well as any charges or mortgages to which the property is subject. Your lawyer can conduct this search for you and advise you as to any possible risks associated with the potential purchase.

Finally, if you are a Cypriot, no other procedure is necessary for the purpose of acquiring property in Cyprus. If you are a citizen of an EU Member State, it is no longer necessary to obtain the permission of the Central Bank of Cyprus, however a notification should be sent to the appropriate administrative body notifying it of the potential purchase. If you are not an EU national, then you have to obtain the permission of the Central Bank of Cyprus in order for you to be able to legally buy property in Cyprus. The particular procedure can take more than six months.

Transfer Fees

A tax-fee is payable when transfer is to be effected of freehold ownership of real estate in the name of the purchaser. The person responsible for the payment of the said tax-fee is the purchaser. The amount of the payable tax-fee depends on the value of the property and can be illustrated as follows:

If the value of the property exceeds the amount of CYP50,000 but not the amount of CYP100,000, the first CYP50,000 will be taxed at the 3% rate and the remaining at the rate of 5%. Similarly, if the value of the property exceeds the amount of CYP100,000, then the first CYP50,000 will be taxed at the rate of 3%, the second CYP50,000 will be taxed at the rate of 5% and the remaining amount will be taxed at the rate of 8%.

Important: If the property is to be transferred in the name of two individuals, the purchase value is divided in two and the amount of the tax-fee is consequently reduced.

Immovable property tax

The registered owner of the property is liable to pay annually immovable property tax, which is based upon the value of the purchased property as follows:

Other fees or expenses

There are certain additional fees and expenses associated with ownership and use of immovable property in Cyprus. More specifically, the owner will have to pay an annual municipal tax, which covers, amongst others, refuse collection and street lighting. The said tax is around CYP60,00 per year. As always, the owner will have to pay all other expenses associated with the use of the property, such as electricity, water and telephone, which are charged at reasonable rates.

Selling your property

If you ever decide to sell or rent your property in Cyprus, you will of course need a valid contract governing all the important aspects of the transaction. You have to bear in mind that in the case of a sale, you will be liable to pay capital gains tax which is charged on the gains from the property disposal at a rate of 20%. There are however certain exemptions.

Inheritance

Even if you are not a Cypriot, Cyprus Succession Laws do not allow you to leave your property situated in Cyprus to anyone you wish. That property or the biggest part of it must pass to your spouse and/or children (or subsequent relatives if no spouse or children exist) and any Will that provides otherwise will not be considered as valid. There are certain exemptions applicable to British citizens who have a wider freedom to leave their property to any person they wish by drafting a Will.