The real estate market in Cyprus is full of investment opportunities, ranging from newly developed locations and high-end apartments to luxury beachfront villas.
In this article, we will provide you with a simple guide for the most important things you need to know before you decide to buy a property in Cyprus.
Cyprus is a small island country in the eastern Mediterranean Sea, famous for being one of the hottest summer destinations for tourists and is considered by many one of the most beautiful islands in the world.
Ranked just 5th in the World in the safest places to live, and 1st in the same research for countries with a population under 5 million, it is also the proud recipient of 74 Blue Flag beaches crowned ‘Cleanest Bathing Waters in Europe,’ with a consistent 100% score, year after year.
The island offers numerous structural advantages for investors with many emerging sectors such as Renewable energy and Green Energy.
The corporate tax rate which is 12.5%, is one of the lowest in the European Union and with an increase in the GDP (Gross Domestic Product) of 3.5% within the first quarter of 2024 compared to the same quarter of 2023, it has shown the highest growth rate of the last 5 years.
These are just some of the reasons why so many Foreign Exchange Market companies (Forex), Fintech, and High-tech companies, have chosen Cyprus as a strategic place to invest and base their business headquarters.
Need we say more?
If you need to learn more, please check our blog: Top 10 Reasons to Buy a Property in Cyprus
We hope this small introduction has helped you understand that buying property in Cyprus can be a really rewarding venture for foreign investors.
Here is a guide to help you navigate through the process:
Legal infrastructure and requirements:
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Cyprus legal system
Cyprus is a common law jurisdiction, based on the English common law since Cyprus was a crown colony of the British Empire until 1960. The courts apply directly the same basic principles. Understanding Property law is not a straightforward procedure, so it is highly recommended to leave it to the pros. Our agency has reputable, experienced, and specialized personnel who can guide you through the whole process and advise on compliance matters so you do not find yourself in an awkward and unpleasant situation with the local authorities.
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Legal Obligations and financial requirements
Residency permit: If you hold an EU country passport, you will not need to apply for a VISA whereas non-EU citizens need to apply for a long-stay VISA.
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Land Registry Department
Considered among the most trustworthy land registries in the world. A solid land registry is always a good way to start if you are looking to invest money in the property market. The department’s responsibilities are to monitor all kinds of property-related cases such as registering a property, transfer of title to immovable property, and any easement requests if needed, such as rights of way, mortgages, and leases. Ensuring the property has a valid title deed is crucial to confirm legal ownership and compliance with the local authorities and avoid any potential legal disputes.
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Opening a bank account in Cyprus
Before you buy a house or property, it is highly recommended that due diligence occurs before the completion of the transaction. Opening a bank account in Cyprus is easy and most banks have the option to do this online provided you provide the required KYC (Know Your Customer) documents to verify your account. These documents are usually a photo of your ID or Passport and a Proof of Residence document dated within 6 months. It is fair to say that when you enter the country, you may be asked for face-to-face communication before the business relationship can begin.
You can learn more about the procedure of how to open a bank account here: Opening a bank account in Cyprus
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Taxes
Cyprus has favorable tax treaties with many countries and one of the lowest corporate tax rates in the EU (12.5%). Stamp duties, transfer fees, and VAT for new owners are some of the things that you need to understand.
Location
Cyprus is full of investment opportunities depending on the type of property and the budget. Before deciding on the location, you must first set your budget, set short and long-term goals for ROI (Return on Investment), and begin searching for the ideal property. Do not forget that location is always a key factor when investing in the property market and is likely to determine the success of the investment project.
If you have not yet decided on the property and city you wish to invest your money, we strongly suggest reading this article especially if you are looking for affordable and rewarding opportunities: Top 8 good reasons to buy property in larnaca
Property Search
Although the web is a useful tool that can help you find everything yourself, it is highly advised to use reputable real estate agents who have knowledge, experience, and resources to find you a good opportunity and spare you from any financial dangers that may not be so obvious.
Our team is skilled and specialized to perform a thorough inspection of the property, negotiate the price, and make sure there are no legal disputes, title-deed issues, planning permissions, or any other deterring factors that will pose a threat to your investment and potentially an unpleasant situation. Just leave it to the pros!
Purchasing the property
Deposit: To commit to the purchase, it is common to pay an initial amount as a reservation deposit. As soon as you pay the deposit, the agreement is in place provided you follow your payment and contract obligations.
Sale Agreement and payment: This is a legal document and as such, it must be drafted by a lawyer, outlining all the terms and conditions and also stating payment scheduled dates. Make sure to follow the scheduled payment dates until the installments are completed.
Title deed or transfer of ownership: After the full payment is sorted, the property is transferred to your name, and the title deed is issued.
Property ownership
You are now the proud owner of the property. Do not forget to consult the real estate agency for post-purchase obligations and ensure that as a property owner, you are compliant with all local laws and taxes.
Is worth mentioning that although the Cyprus investment program offering citizenship to non-EU residents upon meeting certain requirements is currently suspended due to political reasons, keeping an eye out on the available programs is a good idea.
Buying property in Cyprus is a pretty straightforward procedure if you hire a real estate agency with the expertise and knowledge of the local laws and market trends. Our team will guide you through the whole process with transparency, and efficiency. Our experienced team will save you from any market risks and help you select the ideal property that will meet your personal, financial, and professional goals to make the best possible investment.