Buying a property in Cyprus is easy and the whole procedure can take just a few days.

WHAT CAN YOU BUY
As a non-Cypriot, you are entitled to a FREEHOLD ownership of one property, a villa or an apartment or a piece of land up to 3 donums (43.200sq.ft or 4.012 sq.m.) If you are of Cypriot origin there are no restrictions.

1. MAKING AN OFFER
Buying a property in Cyprus is not very different from the U.K. You make an offer and if it is accepted it is normal to give a nominal deposit (between CYP 1.000,- and CYP 2.000,-) to reserve the property, bind the owner, have the property taken off the market and secure it at that day’s price. This in Cyprus, unlike the U.K., is legally binding, so no “gazumping”. Contracts are consequently drawn up and this process takes only a few days. Upon signing of the contract the buyer must pay at least 20% - 30% of the value of the property. The remaining sum is paid according to the terms agreed with the seller,(if any).

2. SPECIFIC PERFORMANCE
The contract, once duly signed and stamped, must be deposited at the land registry office within two months. This is a safety measure, blocking the property and, consequently, not allowing the seller to re-sell it to anyone and hence safeguarding the buyer until the “Council of Ministers” application has been made and approved.

3. APPROVAL OF THE COPUNCIL OF MINISTERS
On having signed a purchase agreement for your property, as a routine procedure, it is
necessary to make an application to the Council Of Ministers to grant it’s approval for
a non-Cypriot to transfer the property to his/her name. You are however, the legal
owner of the property according to the contract law. This is a single process requiring
a bank reference, a character reference and controls issues such as criminal records,
that the land size is within the required limits, that only one home is owned in Cyprus
and that the buyer has the minimum required funds to live in Cyprus. the whole
procedure can take up to six months but, in the meantime, there is no restriction on
taking up possession of your property.
The following points should be considered:
I. Should approval not be granted, you can re-apply.
II. Should approval not be granted, you have 33 years in which to sell your house.
III. You can live in your house from the moment you purchase it – prior to the “Council Of Ministers” granted approval.
IV. You can re-sell your property during this time.
V. It does not effect inheritance rights.
VI. No U.K. citizen has ever been refused approval, exemptions apart, it is a form of control only.

4. PAYING FOR YOUR PROPERTY
You are required to pay for your property from external funds. Personal cheques, bank drafts and telex transfers are all acceptable.
5. SOLICITORS
It is advisable to have solicitor’s advise for the purchase of your property. Their duty will be to do the necessary searches on the property, check the contracts (draw them up in some cases), and do the “Specific Performance” and “Council Of Ministers” application. By law in Cyprus, all registered estate agents must do searches on their properties and must inform the clients on any legal encumbrances, memos, etc.,mortgages or problems related to the property.

6. PROPERTY PURCHASE & OWNERSHIP COSTS

6.1 PURCHASING COSTS
Solicitor CYP 750,- to CYP 1000,-
Search Fees Included in above
Property Transfer Tax See below
Stamp Duty See below

6.2 PROPERTY TRANSFER TAX
This is necessary in order to transfer FREEHOLD ownership to your name and is
due when the property is registered in your name at the Land Registry Office. This
process is done after the “Council Of Minister’s” approval.
The Property Transfer Tax is a once only payable to the Land Registry Office
according to the following scale:

VALUE OF PROPERTY
CYPRUS POUNDS TRANSFER FEE RATE
%
Up to CYP 50.000,- 3.0
From CYP 50.000,- CYP 100.000,- 5.0
Over CYP 100.000,- 8.0

For example, on a purchase price of CYP 110.000,-
The 1st CYP 50.000,- is taxed @ 3%
The next CYP 50.000,- is taxed @ 5%
The remaining CYP 10.000,- is taxed @ 8%
Should the property be bought by a couple, the rate is broken in half, i.e. on CYP
200.000,-:

WIFE HUSBAND
1st CYP 50.000,- @ 3% 1st CYP 50.000,- @ 3%
2nd CYP 50.000,- @ 5% 2nd CYP 50.000,- @ 5%

6.3 IMMOVABLE PROPERTY TAX
The registered owner of the property is liable for this annual tax and it is based upon
the value of his property.
VALUE – CYPRUS POUNDS ANNUAL TAX CYP PER THOUSAND
Up to 100.000 Exempt
100.001 – 250.000 2.5
250.001 – 500.000 3.5
Over 500.000 4.0

6.4 CAPITAL GAINS TAX
Capital Gains Tax is levied at 20% on gains arising from the disposal of the
property, however, for foreign owned property that is sold, generous allowances and
exemptions from Capital Gains Tax exist. As the gain also takes into account
inflation, the actual appreciation coupled with the allowances and exemptions leaves
little for taxation. See brochure for details.

6.5 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,-, and, thereafter, the rate is CYP 2,- per
thousand. This duty should be paid within 30 days of signing the contract.

6.6. MORTGAGE FEES
There is


a registration fee of 1% of the amount secured, plus any relevant stamps.

7. ON-GOING COSTS

7.1 PROPERTY OWNER COSTS (Approx. average)
a) Electricity, depending upon usage : CYP 30, - every two months.
b) Water, depending upon usage: CYP 10,- to CYP 20,- every two months.
c) Sewerage, depending upon usage : CYP 50,- per annum.
d) Service Charges : for apartments : CYP 100,- to CYP 200,- per annum.

7.2 TAXATION
Double taxation agreements exist between Cyprus and numerous European
countries, which regulate taxation matters regarding residents of the island.
As an example: alien retirees are taxed on a flat 5% per annum on pension and
Investment income brought into Cyprus with exemptions totaling CYP 4.000,-
per person of CYP 8.000,- per married couple. Further details are available on
request.

7.3. ESTATE DUTY
Estate duty was abolished as from 1/1/2000.

7.4. Please note that laws and regulations of various governmental departments
are constantly changing in view of the harmonization of Cypriot laws with
those of the European Union. As accession talks proceed, a lot more laws and
regulations, as we now know them, will be either abolished or amended.