LEGAL ISSUES

1. Legal fees  2. Expenses  3. Our exposés

  PURCHASE OF REAL ESTATE PROPERTY IN CYPRUS

Under the Immovable Property Acquisition Law Chapter 109 a non-European can acquire either a flat or a house/villa or a piece of land (for the erection of a house) not exceeding three donums (approximately 4.000 m²).

All EC Citizens have as from 01st of May 2009 the equal rights like Cypriot Citizens to acquire any kind of property for private purpose. On purchase of industrial and commercial real estate we will advise, if any kind of permission is necessary additional from the Cypriote authorities.
Properties in Cyprus for private use are usually freehold; only a few properties mainly for economical purposes are leasehold.                       

1. Legal fees and tax related to the contract

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- The permission of the Council of Ministers is required from non-EU Citizens, which is usually obtainable in all bona fide cases, provided that the property is not intended for development or commercial exploitation.

- Contract of Purchase:
Under Cyprus Law contracts for immovable property must be in writing. It is advisable that contracts of purchase are deposited in the relevant District Land Office within 60 days after signing the contract to secure the buyer’s rights in an absolute manner.
The purchaser is liable for the payment of a stamp duty for registration of the contract at a rate of 1.5 per thousand of the value of the contract up to Euro 85.430,05 (CY£ 100,000); thereafter the rate becomes 2.0 per thousand. The registration of the contract on the Land Registry Office should be proceeded within the shortest possible time (per law within 30 days after contract signing) to secure the right of the buyer for "specific performance" and to secure that the property cannot be re-sold again though securing the real estate investment in Cyprus.

- Transfer of Title deed - legal expenses:
Transfer can be effected from EU-Citizens, if the full amount of the property purchase has been settled and the vendor has fulfilled his duties regarding the necessary certificates for the transfer. Non-EU citizens, need for the transfer the permit of the Council of Ministers in hand and, if have purchased agriculture land a valid building permit.
Transfer fees are to be paid on the day of the transfer to the Land Registry Office as follows:
Purchase price of the property
- Up to Euro 85.430.05 (CY£ 50,000)                                     3.00 %
- From Euro 85.430,06 to 170.860.10 (CY£ 50,001-100,000)    5.00 %
- Over Euro 170.860,11 (CY£ 100.000)                                   8.00 %
The transfer of the title deed gives the legal ownership of the property from the vendor to the purchaser. After payment of the transfer fees the purchaser is immediately the legal owner of the property with all rights and duties in connection with the property.

- Legal advise:
The Cyprus property Law is based on the English property Law and different to other EU-Countries, also there are no notaries, appointed and controlled by the government, who per law have to proceed with a real estate sale. Legal advise should be sought from trustworthy and competent lawyers before making any commitment to a purchase. We recommend our company lawyer Mr. Fokas Sofroniou, who is specialised in the property and company laws in Cyprus to handle his affairs. Nevertheless the purchaser is free to appoint a solicitor of their own choice in Cyprus.  

- Please note: This information is without any obligation, not legal advice and conditional on changing of law and regulations in Cyprus. 

2. Expenses associated with ownership

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- Common expenses  (for properties in housing estates):
These are payable over fixed periods throughout the year and depend on the area of property and will vary from development to development. They cover the owner’s share toward the cost of cleaning and maintaining common areas and gardens, swimming pool expenses, management fees, insurance of the complex, collections and repairs. They are estimated to be from Euro 300 to 600 p.a. (CY£ 150 to 300), in luxury developments higher.

- Utility Services:
The services for electricity, water and telephone are payable to the appropriate authorities over fixed periods throughout the year. They are based on a fixed fee plus consumption of each unit. There is to be paid a connection fee and a refundable deposit on connection to these services.

- Insurance:
A comprehensive insurance coverage for fire and other hazards for houses is legally required in Cyprus for housing estates/developments. The premiums depend on the value of the property. In housing estates and apartmentblocks the premium is per law included in the common expenses. For private houses building insurance is not legally required but strongly recommended. Insurance for "contents" for all kind of properties is the owner’s responsibility, not legally required but advised.

- Refuse Collection and Sewerage System:
The local Municipality and/or other authorities are responsible for the collection of garbage at regular intervals. The costs depend on the area and the kind of the property. Invoices are issued annually for this services.

- Property taxes and rates:
Immovable property carries an annual tax from the Government, based on the market value of the property on the 1st of January 1980. The rates are:

Market value 1980		Annual tax rate %
Up to Euro 170.860,10 (CY£ 100,000)		nil
Euro 170.860,11-427.150,25 (CY£ 100,001-250,000)		2.0
Euro 427.150,26-854.300,50 (CY£ 250,001-500,000)		3.0
Over Euro 854.300,51(CY£ 500,000)		3.5

Also the Municipal Authorities levy an annual property tax rendered at the rate of about Euro 80 to 200 p.a. (CY£ 50 -100) depending on the area and the kind of the property.

Please note: The above are correct to the best of our knowledge. Small variations will exist due to varied amounts and consumption in each case. 

3. Our Exposés

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Our Exposés are accurate to the best of our knowledge. All information is provided by the private owners, our co-operating Cypriot developers and associates without any obligation for Blue Island Agency Ltd.. All measurements given are approximate and not legally binding. The prices do not include the additional costs related to the purchase of property in Cyprus (e.g. lawyer's fees, transfer fees, taxes etc.). Stated prices can be subject to variation without prior notice. Interim sale cannot be excluded.

All exposés are property of Blue Island Agency Ltd. and may not be copied or otherwise published without prior consent.
 
From 01.01.2008 Cyprus joined the Euro zone with a final fixed exchange rate of
1 Euro = 0,585274 CY£
1 CY£ = 1,708601 Euro

Blue Island Agency Ltd.  - Property Consultants & Developers  
Office: Riverside II, Christaki Kranou 16, Yermasoia, CY-4041 Limassol, Cyprus
Mailing address: P.O. Box 57228, CY-3313 Limassol, Cyprus
Tel. +357 25315282, Fax +357 25315282, Mobile +357 99687822 

Email: info@realestatescyprus.net

Last edited: 15.01.2010