Cyprus sits at the eastern end of the Mediterranean and lies approximately 100 miles off the southern Turkish coast. The island of Cyprus has in recent times expertly combined business with pleasure by carving out a niche as a popular location for offshore business whilst taking advantage of its natural beauty and climate to become a busy tourist hot spot. Its long history has seen the country absorb a mix of influences from Ancient Greece right through to the modern era when it became an important military and strategic base within the British Empire at the crossroads of Europe and Asia.

A British military presence remains to this day and Cyprus has become home to a large expat community (estimated at around 50,000), while British tourist trade accounts for the overwhelming majority of the country's tourism income.

A look at the Cypriot climate and it's easy to see the attraction: average temperatures only dip below 70F (21C) between November and April, and the country can boast on average 300 days of sunshine per year. English is also widely spoken by the local population, and the legal and land registry systems are largely based on British practices. What's more, they also drive on the left side of the road!

Cyprus is a member of the EU and adopted the Euro in January 2008.

Cyprus in the EU includes links to Cypriot government sites and Tourist Information.

Searching for Property: A lot of information is readily available from newspapers, magazines and from Internet websites which advertise properties for sale in Cyprus. It is also easy to get an idea of what type of property is available and at what cost before you actually start your search. There are many ways to search for properties: estate agents, property magazines and web sites. You will find that most estate agents speak fluent English.

Think carefully about the location and type of the property depending on whether you plan for it to be your main residence, second home, holiday home to be let out on occasion or a property to be let out as an investment for the future.

Make a list of your most important requirements, purchase price, overall size, number of bedrooms, garden, terrace or balcony, etc. The type of property and its condition is also an important consideration.

If you intend to buy and renovate or build a new property, then this demands careful pre-planning. Planning consent and building approval will be required.

There are many ways to search for properties: estate agents, property magazines and web sites. You will find that most estate agents speak fluent English.

Think carefully about the location and type of the property depending on whether you plan for it to be your main residence, second home, holiday home, or to let out as an investment.

Make a list of the important elements - the purchase price, the overall size and number of rooms, would you prefer a garden, terrace or balcony, etc - it will keep you and your estate agent or on the right track to find your ideal property.

The type of property and its condition is also an important consideration. Buying to renovate or build a new property demands careful pre-planning. Planning consent and building approval will be required. You will need the advice of an expert - an architect or surveyor.

Legal Procedures: An EU citizen is permitted to own as much land and property as they wish without any restrictions.

Once the Title Deeds for the property they are buying become available, they are required to provide proof of their citizenship by taking their passport to the District Lands office when they pay the Property Transfer Fees.

Once you have identified a property that you wish to purchase you need to sign a preliminary contract. At the time that this agreement is executed, a holding deposit is posted with either a lawyer or a notary.

When the holding deposit is paid, a companion reservation deposit agreement is also executed. The property is then taking off the market and remains in that position for the time spelled out in these agreements. Provided that the terms of the preliminary agreement are satisfied, the property will not return to the marketplace.

The deposit lodged can be as low as 1%. The parties can negotiate a particular deposit amount, but, in most instances, the standard deposit is in the amount of 1% of the overall purchase price of the property that is being sold. The remaining balance due and owing on the overall purchase price will then be paid at the time of completion and the execution of the final contract.

During the time following the execution of the initial, preliminary agreement, the lawyer who has been appointed to oversee the transaction will investigate the status of the title through the District Land Registry Office.

Following this period of investigation into the status of the title, and provided that the buyer has obtained appropriate financing, the parties move onward to the execution of a final contract. It is at this juncture that the closing of the property transaction in Cyprus becomes rather complex when compared with what occurs in most other countries around the world.

When the final contract is signed by the parties, the contract itself is filed with the Land Registry Office to prevent the same piece of property from being sold a second time. An application is then made to the Central Bank of Cyprus to approve the transfer of funds for the purchase of the real estate. (This approval is not necessary if both the seller and buyer happen to be foreign nationals. However, it is required if at least one party to the transaction is a Cypriot.)

The title will be transferred to the buyer at this point and the buyer will be entitled to possession of the property. It is important to note that if the property is a new development, the title itself will not be issued for upwards to three years after the signing of the final contract. With that said, the buyer is protected because of the filing of the final contract with the District Land Registry Office.

Taxes: There will be some taxes due and owing which have to be paid by the purchaser after the signing of the final contract. However, these taxes are small and not particularly significant.

 

Lawyers: The worst mistake many people make when buying property in Cyprus is to use a lawyer who has been introduced or recommended to them by a property developer. Others fall into the trap of using the 'free' legal services provided by some of the developers. Property buyers are generally unaware of the different business culture in Cyprus and the fact that many lawyers work for the developerís interests rather than those of the buyers.

The above information will help you understand how different the business ethics are in Cyprus compared to those in the UK and how important it is to get honest, independent legal advice.

To help avoid legal problems and the very real risk of losing your money, it is vital that you take advice from an independent Cyprus property lawyer and it is essential that you do not sign any papers or hand over any money until you have done so.

The British High Commission in Nicosia publishes a list of lawyers who are able to give advice in English to British nationals.

Rental Market: The best investment strategy is to buy property in one of the residential suburbs of Nicosia or Limassol where there is a good demand for long term rentals. Although the weekly rate you achieve will be lower than holiday lets, this will be more than offset by the longer rental period. And your overheads too will be considerably lower. Holiday lets can only be rented out for 12 to 14 weeks per year on average.

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Disclaimer: This guide is for information only and should not be relied upon as definitive. Details have been obtained from various sources and although we have done everything possible to ensure that it is correct, we cannot accept responsibility for it or guarantee its accuracy. This is because processes and laws change frequently, and may also vary dependant upon personal circumstances. You are welcome to use the information provided, but should always obtain confirmation of specific details and get independent specialist and legal advice in the country that the information refers to.

26-10-2009