Why Cyprus?

 Cyprus enjoys a warm climate throughout the year, and its people are well disposed towards the British, as a result of long-standing good relations between the two nations. Attractive taxation laws make it particularly appealing to retirees.
 The island’s accession to the EU in 2004 has resulted in improved infrastructure, communications and facilities, particularly in the medical and educational sectors. Its joining of the Euro on 1st January 2008 has further underlined its position as a modern republic that welcomes people of all nationalities to its shores.
 Property prices have risen by as much as 80 per cent over the past five years, but still represent good value in comparison with other, more established markets, such as Portugal, Spain and Italy, particularly for new build property, which is in the majority on the island.

The Market

Cyprus is one of the more popular real estate markets in the world. Activity in the real estate market in Cyprus is brisk, including foreign nationals who buy and sell real estate Non-Cypriots have been involved in all areas of the real estate market. Foreign nationals have been found to invest in commercial, investment and residential real estate in all areas of the country.
 Most industry experts maintain that the property market in Cyprus should continue to do a brisk business well into the coming decade. With the entry of Cyprus into the European Union, more and more foreign nationals from EU member states likely will become involved in the Cypriot real estate market.

Locations

The main tourist resorts are found in the south, such as Paphos in the south-west. Limassol in the west is the island’s second largest city. Larnaka, the honorary capital, is home to the island’s main international airport and is the first port of call for all visitors to southern Cyprus.
 The town of Ayia Napa – located in the eastern region of Famagusta – was once a small fishing village, initially claimed as a tourist destination by travellers in the Sixties. Today, it is an internationally renowned holiday hot spot, famed for its nightlife as much as for its beaches – yet it has still retained much of its original character.
 We offer properties in the Southern town of Limassol, Paphos- a very popular resort and town 40 miles west of Limassol, sea-front town of Larnaca in the South - East of the island and slightly North, in the region of Farmagusta.
Getting There
Four day Inspection Trips are available at aprox €349(£199).
Cyprus is served by scheduled airlines year-round and by charter flights during the summer season. (easyJet are taking over GB Airways' flights from March 2008).Wizz air is also flying to Larnaca. Flying time is up to five hours

Buying process

 The Republic of Cyprus joined the European Union in 2004 and as a direct result the government has been forced to begin aligning its rules relating to foreign freehold ownership of real estate with those of all other European nations.  To that end Cyprus will have to change the rules that currently only allow overseas purchasers to own a single property in Cyprus on land not exceeding 4000 square meters.
 While the wheels slowly turn towards constitutional changes being made, unfortunately this ruling is still in place and anyone wanting to buy property in south Cyprus currently should be aware that they are limited to the purchase of a single property unless they form a Cyprus based company and acquire land and real estate via that company.
 The first aspect is of course locating a suitable property; if the property chosen is a resale then an offer price should be submitted to the vendor via the estate agent. At this point a buyer should secure the services of a solicitor in Cyprus who will conduct all the searches on the property and basically help with the buying process. Solicitor should begin title and land searches and draw up the purchase contract.  As you generally only sign a single purchase contract in Cyprus the buyer should only sign it when all the checks have been conducted satisfactorily. 
 When it comes to contract closure both the vendor and buyer will sign the contract which will be notarised and submitted to the land registry in Cyprus.  Upon this date the purchase price will need to be paid unless the buyer has bought preconstruction and then according to the terms of the contract, various stage payments will need to be made for the property throughout the build process.
 The buyer then has a month to make all taxation and fee payments and soon after signing the purchaser contract the buyer’s solicitor will apply to the Council of Ministers in Cyprus for the buyer’s right to own the property. 

Taxes&Costs

 Cyprus is unique when it comes to the taxation aspects of living on the island.
Retirees who become residents in Cyprus are taxed on their pensions from abroad at the rate of 5% for amount: exceeding £2,000 annually.
Of course as for all Cypriot tax residents their total annual income up to £9,000 (£10,000 from 2004) is tax exempt.
Duty Free Privilege
There is no import duty on cars and for retired couples there is an additional concession of two duty free cars.
Personal effects, household goods and furniture can be imported free of any taxes by immigrant retirees provided they are for personal use (and have been used for a while) or - and are not brand new, indicating prior usage.
Transfer tax             
 If your property is worth up to CYP 50,000 you will need to pay a transfer fee rate at 3%. From CYP 50,000 to CYP 100,000 it will be 5% & for properties over CYP 100,000 the transfer fee rate will be at 8%
 Should the property be bought by a couple, the rate is split in two, i.e. on CYP 200,000, the first 100,000 pounds the wife will have to pay tax at 3% on CYP 50,000 as will the husband. On the second CYP 100,000 the wife & husband will pay 5% on each CYP 50,000.
Capital Gains Tax
 This is levied at 20% on gains arising from the disposal of the property, however, for foreign owned property that is sold generous allowances & exemptions from Capital Gains Tax exist. As the gain also takes into account inflation, the actual appreciation coupled with the allowances & exemptions leaves little for taxation.
Stamp Duty
 The purchaser is liable for the payment of Stamp Duty at the rate of CYP 1.50 per thousand up to the value of CYP 100,000 &, thereafter, the rate is CYP 2.00 per thousand. This duty should be paid within 30 days of signing the contract.
Local authority taxes and rates
A rough guide could be approximately CYP 50 -150 per year depending on the size of your property. This tax is for refuse collection, street lighting, sewerage, etc.
Mortgages are available at up to 80% interest only, or capital and interest, from 3,9% over up to 30 years untill the age of 70.

This web site provides general advice for guidance purposes only. It is recommended to seek professional advice before making any purchase. Contact us for additional information or services.