Acquiring Immovable Property in Cyprus
Introduction
Cyprus is a small island and its land is a scarce commodity. The constantly increasing demand for land, houses, offices, holiday homes, hotels, golf courses and for many other types of immovable property has, therefore, kept the value of land constantly rising and has turned it into one of the best investments in the Cyprus market.
The great demand for land in Cyprus is the result of many factors, such as:
- The invasion of Cyprus by Turkey in 1974 and the continuing occupation of around 37% of its total area, which led to the re-housing of 200.000 refugees in the unoccupied southern part of the island.
- Cyprus’ stable political and economic environment, especially since its accession to the European Union on 1.5.04 and its membership of the Euro zone since 1.1.08.
- The formation and physical presence of many international business companies in Cyprus due to the favorable tax regime and the consequent presence of their directors and employees with their families in the island.
- The presence of a great number of foreign nationals in Cyprus who have chosen Cyprus as their retirement home or as their regular holiday destination due to the safe and friendly environment, the excellent weather conditions, the low tax and other advantages offered.
- The high standard of living in Cyprus, allowing Cypriots not only to own their own main residence but also to own a holiday home.
Despite the great demand for land in Cyprus it is important to note that prices are still reasonably affordable compared to prices in most European Union countries.
Legal Framework
Any person wishing to purchase, lease or otherwise deal in immovable property in Cyprus may do so safely due to the efficient legal system regulating and protecting rights of ownership and possession of such property.
Cyprus is one of the few countries in the world which maintain a Land Registry where all immovable property is registered and a title deed is issued in the name of the rightful owner. Any mortgages, charges, encumbrances, easements or restrictive covenants are also registered at the Land Registry.
Any prospective purchaser may, carry out a search at the Land Registry to verify whether the seller is the rightful owner of the relevant property and to check whether such property is subject to any charges or restrictions.
The purchaser’s ownership is secured by the transfer and registration of the immovable property he has purchased, in his name, at the Land Registry.
Even before such registration is effected the purchaser may safeguard his right to have the property transferred to him by depositing the contract of sale at the Land Registry within 60 days from its execution.
In order to take advantage of the available legal protection and avoid unnecessary risks and complications all persons interested in acquiring any immovable property in Cyprus should seek and obtain legal advice from an experienced and reliable legal firm.
Acquisition of immovable property by non-Cypriots, Non-EU citizens
The acquisition of immovable property by non-Cypriots is subject to certain restrictions imposed by the Acquisition of Immovable Property (Aliens) Law Cap.109. Under this Law any non-Cypriot wishing to acquire immovable property in Cyprus must obtain the permit of the Council of Ministers, unless the property is acquired by inheritance.
Acquisition of immovable property by non-Cypriots, EU citizens
No restrictions apply to European Union citizens or to legal entities registered in any European Union country except for the acquisition of a secondary residence by European Union citizens who are not permanent residents of Cyprus or by legal entities registered in a European Union country which are not based in Cyprus.
Permits
In cases where a permit is required it is granted as a matter of course, in all bona fide cases, for the acquisition of:
- an apartment or a house or a plot of land not exceeding 2 donnums (nearly 3000 sq.m.) for the erection of a house, provided that it is intended as a residence for the purchaser himself and not for rental or other exploitation.
- an office for the use of the purchaser.
Immovable property in the occupied part of Cyprus
Prospective purchasers are warned against acquiring any immovable property in the area occupied by Turkey in the northern part of Cyprus. The legal framework described above only applies to property in the area under the control of the Government of the Republic of Cyprus.
Almost all of the immovable property offered for sale in the occupied northern part of the island belongs to Greek Cypriots. The persons offering such property for sale are not its rightful owners. Any purchaser of such property runs the risk not only of losing the property he has paid for, but also of paying compensation to the rightful owner.
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