The official language of Cyprus is Greek. However, most of the population speaks English to some extent, which facilitates the process of integration into society. There is another key factor that contributes to buying a house in Cyprus. This is a wide range of entertainment, from visiting historical buildings, and museums to restaurants, bars, and clubs. Buying real estate in Cyprus has some nuances that are important to be familiar with. We recommend potential buyers be especially careful when buying real estate. A common scenario when buying a new property in Cyprus is that the title deed is not available. Many wealthy individuals from the USA, Canada, EU countries, and other countries seek to acquire new apartment for sale in Limassol, Cyprus by obtaining citizenship through investment schemes or residence permits through investment applications. Check out the ten most common pitfalls to avoid when buying property in Cyprus and the key things to help you make buying property easy and efficient.
Wide opportunities to purchase the desired real estate in Cyprus
Cyprus is famous for hosting many parties, festivals, fairs, and exhibitions. Participation in horse racing, chariot racing, scuba diving, sailing, golf, and other sporting events at the clubs will not leave anyone indifferent. Health care in Cyprus has reached a very high level, this can be considered one of the undoubted advantages of living here. Clinics on the island are equipped with all kinds of modern equipment. All doctors are very professional. For foreigners living in Cyprus and investing in the economy, there are special preferential tariffs for services in public clinics. You can also turn to private insurance companies that offer a full range of services for a small fee. The purchase of real estate in Cyprus takes place following the conditions of regulation of the entire legislative framework. The entire process of creating a document for the purchase of real estate takes place in English.
The process of buying real estate from sellers is handled by an experienced real estate agency. The buyer receives a legal document on ownership after completing all the necessary documents. In addition, very low taxes in Cyprus distinguish the country from many other European countries. Foreigners looking to buy real estate here enjoy several key benefits. When evaluating real estate for sale, special attention should be paid to the local banking system. One of its key qualities is guarantee and reliability. All banks work at the international level and have extensive connections with all countries of the world. Any foreigner can use banking services, open an account and send money anywhere in the world. Global payment systems work in Cyprus, so there will be no problems with transferring funds. One of the important characteristics of Cyprus is the low level of crime compared to similar averages in other EU countries. Residents are used to the very low level of theft in Cyprus. Residents even have a habit of leaving the front door of the house open, not locking the car door. This is the first thing that surprises foreigners.
Peculiarities of document processing
One of the key advantages of buying property in Cyprus is that it is one of the most reliable and profitable investments. Despite all the crises that regularly shake the world financial system, Cypriot legislation protects real estate very strictly. Local law enforcement agencies are trying to prevent fraud in this area. Another good thing – the value of the real estate increases from year to year. Moreover, growth can even reach 7-10% per year. Credit is also well-developed, which allows you to take long-term loans. Lending has a very low-interest rate, approximately 4% per year. At the same time, the government guarantees strict confidentiality of all financial transactions.
In addition, Cyprus is considered one of the best places to start and run a private business due to a large number of various tax benefits. However, when buying real estate, you need to know how this process works. For example, foreigners can buy only a few types of real estate. It includes apartments, houses, and land. The area of the purchased land is limited. In any case, there is always a way out to register additional valuation assets on a legal entity. To do this, it is necessary to register a private company in Cyprus, the legal entity rights of which belong to the actual buyer of real estate. You don’t even need to come to Cyprus to register your company. All documents are sent by mail. Having your own business in Cyprus has many key advantages. This makes getting a mortgage much easier.
Don’t hire a real estate lawyer
Hiring a real estate attorney is an extremely important process. The biggest mistake you can make is signing the sales contract presented to you by the developer. Such contracts are unlikely to protect the buyer and are often heavily biased in favor of the developer. In addition, buyers should be aware of independent attorneys representing sellers. A reliable lawyer fluent in the buyer’s language and independent of other parties is a key condition when buying real estate in Cyprus. A good lawyer can effectively help you avoid these potential pitfalls. In short, property bought in Cyprus is a profitable investment and should not be made without hiring a professional real estate professional. Prevent your property from becoming vulnerable to property disputes, as the property you purchase should not be the subject of joint ownership disputes, such as in the event of a divorce. Such scenarios can often be avoided by buying real estate from proven developers. However, this is not always the case. In particular, in recent years, there has been an increase in the willingness of developers to act as brokers in the resale of real estate (as a rule, objects that have already been developed and sold to customers).
Secret commissions
Hidden fees, which are not agreed upon between all parties in the process of buying real estate in Cyprus, are probably the most expensive nuances that can occur when buying real estate. These secret commissions range from 5% to 50% or more. Such expensive financial costs can easily be avoided if you have a reputable lawyer who can easily provide potential clients with all the necessary guidance to successfully purchase the desired property.
Careful calculation of all relevant costs
It is important to calculate as soon as possible the relevant VAT, transfer costs, court fees, various other payments, and property taxes that you need to pay for the purchase of apartments for sale in Limassol, Cyprus. You can budget your expenses accordingly. Cyprus real estate consultants often misunderstand or misrepresent to buyers the calculation of all the necessary taxes and other payments that need to be paid when buying real estate in Cyprus. Property buyers who opt for the flat sales tax often find themselves unable to manage their property the way they would like or face high sales tax liabilities.
Reduced booking fees without written booking conditions
When a buyer is asked to pay a booking fee to the organizer, they should get the document in writing, ideally from an appointed solicitor, for their safety.
The total purchase price of the property. It can be reduced depending on the situation
It is important to conclude a sales contract with due diligence. Lawyers don’t have to do this, but a good lawyer should check all the details of the agreement. In 2011, the government passed special enforcement legislation that gives priority to sales contracts. However, to avoid further problems, it is worth checking whether there are no encumbrances on the property before buying. A legal agreement cannot properly be successful without taking into account this thorough research done. In addition, buyers are advised not to rely on developers’ due diligence, even if developers provide official offers from the Land Registry or other government authorities.
Buyers are advised to ensure that all matters discussed are accurately documented in the legal sales agreement, including any additional services agreed upon. This includes a list of necessary repairs or restoration of damage. A purchase and sale agreement successfully concluded between the parties must be submitted to the land cadastre within the time limit established by law. If this does not happen, the buyer loses important legal claims. In addition, the purchase agreement must be concluded within the time limit provided by the law. Otherwise, the buyer must pay a contractual penalty. Many luxury villas and apartments require a property management agreement to be signed. Usually, this service is provided by sellers. This is an important contract, and utmost care should be taken to fully understand all the terms and conditions written in this contract to ensure complete protection and safety of the buyer’s property when leaving Cyprus. Cypriot law governs all immovable property in Cyprus, including compulsory inheritance.
However, certain categories of foreign buyers have the right to bypass these rules and make a will on the transfer of their property at their discretion. When buying real estate in Cyprus, buyers must make a will. It is important to learn from the mistakes of buyers who bought real estate before the financial crisis in various countries of the European Union and got into expensive legal proceedings. However, according to the latest survey, the dream of real estate is relevant for millions of people who are actively considering the possibility of a profitable purchase of real estate abroad. Avoiding these pitfalls becomes an even more important aspect when investing in real estate in Cyprus. Investors often invest through investments as part of their citizenship application, these investments typically range from €2 to €2.5 million. By keeping in mind the above nuances, you will be able to avoid most of the potential problems associated with buying real estate in Cyprus. First of all, it is extremely important to get independent advice from a competent lawyer. A good lawyer should make sure that the buyer is protected from all the unpleasant nuances that may arise during the process of buying real estate.
How is the process of buying real estate in Cyprus?
All foreigners have the right to buy a house or apartment in the Republic of Cyprus. Of course, there is only one limit. A foreigner has the right to own one property with an area of up to 4,014 m2.
The procedure for buying a home by a foreigner is as follows.
1) Choose the appropriate option. We recommend using the services of a reliable real estate company. The real estate company selects an object that meets the client’s wishes.
2) Open a bank account. The minimum deposit required to open a bank account is only 10 euros. Only a passport is required.
3) Make the required deposit (approximately 1-2% of the value of the house) and sign a legal contract of sale. Using the services of a lawyer or other representative under a notarized general power of attorney allows the buyer to minimize his participation in this process.
4) Payment for purchases in the form and under the conditions specified in the contract. In addition to the price of the house itself, there are also certain associated financial costs (all the necessary taxes and various payments that must be paid for the re-registration of the documents for the ownership of the purchased property).
5) Save the contract status. To do this, an application for approval of the contract and a copy of the owner’s passport is submitted, and the real estate purchase contract itself is entered into the land cadastre within 60 days. This measure is aimed at protecting buyers from malicious actions by real estate sellers.
6) Final registration of ownership of the house – Obtaining a purchase permit from the Council of Ministers, and registration in the Land Cadastre. The title document (a document confirming the right of ownership) is drawn up with the personal participation of the seller and the buyer. From the moment of submission of documents for property registration, a foreigner receives the right to use the purchased real estate.
