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Key things to know when buying property in Cyprus.
Purchasing a property that will be used as a home is a dream come true for many people. When deciding to go through this idea, you should take into consideration some aspects to secure your desired outcome.
According to Cyprus law, Cypriots or persons of Cypriot origin as well as EU citizens who have their permanent residence in Cyprus (at least 185 days a year) are allowed to acquire any property without restrictions.
In the text below we outline the basic checks that a future buyer must perform preferably though a law firm or lawyer.
Developer Check – Registered Title deed.
Factors that the buyer must consider before deciding where to buy the property are:
- Legal status of the Developer company and compliance issues.
- Is the developer company legally registered,
- does it file accounts with the Registrar of Companies?
- Is the company ok with the tax, vat?
- Reputation of the company.
- Availability of title deed
- If there are any easements regarding covenants or other prohibitions on the land or third party rights.
- Are there any other charges?
Loan from Financial Institutions.
In most cases where the purchaser does not have all the funds available he may ask for a loan from a financial institution. In these cases legal advice should be sought in relation to the contract with the financial institution.
Offer and commitment.
In Cyprus, unlike in the case of the United Kingdom, there is no “gazumping”. In other words, you can commit the owner of the real estate, after accepting your offer, to make a nominal deposit (between €1500 – € 5000) so that you can keep the property.
With the help of a lawyer, you draw up a contract and at the time of signing, the buyer must pay at least 20% -30% of the value of the property. The remaining amount is paid in accordance with the terms of the contract.
Contract of purchase.
A properly drafted contract can save the purchaser a lot of trouble and problems in the future.
There are key contract clauses that need to be inserted in any contract for the purchase of property whether flat or house. Some of these are:
- Quality of construction,
- Time of delivery,
- Issuance of title deed,
- Mode of payment.
The buyer of the property can secure the transfer of the acquired property in his name, by filing a copy of the contract, signed and sealed by the Land Registry of the District that the property is bought within two months from its signing. The filing of the contract creates a charge on the property and prevents the owner from transferring the property to a third party. Further the filing of the contract to the Land Registry gives the purchaser the right to seek “special execution” of the contract via the court, in case the seller refuses to transfer the property when a title is issued.
- Stamps (buyer responsible unless the contract states otherwise)
- rate 0.15% of the value of the property up to € 170,000 and 0.20% for over € 170,000.
- Transfer fees
- € 0 – € 85.000 –> 3%
- € 85.000 – € 170.000 –> 5%
- > €170.000 –> 8%
- Immovable property tax : Not applicable at the time of writing.
How we can help.
Our law firm can represent your interests when buying or selling your property in Cyprus. For more information send us email at this link.