Buying Guide and Costs
Now you have decided to buy a Dream Holiday Home in Cyprus. Here are some simple tips and advice to consider before and after buying your property. The answer to the following questions will undoubtly have an influence on how, where, when and what type of property you will need to purchase,
Therefore, knowing the answers would help us find you the perfect property for your needs.
Step 1 - What is your need to Buy a Property in Cyprus?
(a) A Permanent or Retirement Home
(b) A Short or Long Term Investment for your Future Retirement Pension
(c) To earn Additional Rental Income
(d) To be near Family and Friends
(c) Business Venture
Step 2 - How are you Financing the Purchase?
(a) Cash Purchase
(b) Remortgaging UK Property
(c) Cypriot Mortgage
(d) Private/Business Loan
Step 3 - Where to Buy in Cyprus?
(a) A Particular Favourite or Popular Tourist area, Paphos, Limassol etc
(b) Facilities available in the area, Hospitals, Schools, Tourist Attractions etc.
(c) Distance from Airports?
(d) Location? Close to Beach, Shops, Nightlife, Rural, Golf Areas etc
(c) Property Value and Investment Growth Prospects
Step 4 - Decide who to buy your Property from?
(a) A Local Cypriot Builder
(b) A Local Cypriot Estate Agent
(c) A UK and Cypriot Estate Agent
(d) Direct from Owner
Step 5 - When to arrange a Visit?
(a) After you have considered all the above options and arranged finances.
(b) After collecting details and information of suitable properties to view.
(c) After choosing an Agent or Builder
(d) As soon as possible to avoid the extra costs of rising property prices and inflation
Step 6 - Arrange Flight and Accommodation
(a) Book for at least 1 week to allow sufficient time to tour the local area and view a number of properties in your own time.
(b) Avoid short 3 - 4 day trips, they can result in little time to consider your options and making the wrong, hasty decision.
(c) Book suitable, relaxing, quality accommodation, staying in poor accommodation may put you in the wrong frame of mind to even think about buying a property.
Step 7 - Viewing and Negotiating a Deal on a Property
(a) View at least 3 properties. Don't commit to buying the FIRST Property you view.
(b) Gather as much information about each property, rental potential, maintenance, insurance, future developments, builders credentials, property legally built, outstanding debts etc.
(c) Legal costs and Agents Commission
(d) Special offers, Discounts for additional extras, air conditioning, security, furnishing etc.
(e) Payment methods
(f ) Consider all options and allow 24 hours before making a decision. If you are not happy, don't feel commited to buy! Return Home to UK.
Step 8 - Commiting to Buy
(a) Agreeing a Price for Property and Additonal Services, Fixtures if Required.
(b) Appointment will be made to visit a Solicitor and sign contracts.
(b) Pay a Holding Deposit and arrange Payment Method.
Step 9 - Completion of Property Purchase
(a) Final Inspection of Property
(b) Pay Outstanding Balance
(c) Arrange Completion Date, Hand over of Keys and Title Deeds (Transfer of ownership takes place by a simple process of registration at the Land Registry Office and the issuing of a Title Deed after completion and delivery. This can be done either by you personally or by a Power of Attorney to your Solicitor)
(d) Arrange Insurance, Register for Utility Bills, Council Tax etc.
(e) Furnish and Move into Property.
Approximate Legal Buying Costs
(1) Real Estate Transfer Tax Fees
Real Estate Transfer tax-fees are necessary in order to transfer FREEHOLD ownership to the name of the purchaser. This can be done as soon as the relevant Government Authority has issued the Title Deed and the purchase has been completed. The Transferee is responsible for the tax payment.
The Rates are as per the Following Graduated Scale
(2) Stamp Duty
The purchaser is liable for the payment of stamp duty at the rate of 1.50 pounds per thousand up to the value of 100,000 CY Pounds thereafter the rate is 2.00 pounds per thousand. This should be paid within 30 days of signing the contract.
For example if the Purchase Price is CY £150,000?
(3) Immovable property tax
The annual immovable property ownership tax is based upon the value of the property. Certain immovable properties are exempt.
Value of Property
(4) Inheritance Tax
Cyprus does not have any inheritance tax, making it an ideal place to invest your money as you can be assured that any person inheriting the property will NOT be liable for any taxes when the owner has deceased.
(5) Wills
It is imperative that expatriates have wills that are appropriate to the national laws of the country in which they are living. Needless to say, English law is not entirely the same as the law of Cyprus jurisdiction. Owners of holiday homes outside the UK are sensibly advised to make a local will to deal just with that property, either for reasons of local law, or because it makes things easier, when the time comes to wind up the estate, to deal with a property under a local will.
The cost of making a will in Cyprus can vary from lawyer to lawyer, as a guide it can be between Cy £50 - Cy £150
| Value of Property (Cyp £'s) |
0 - 50,000 |
50,000 - 100,000 |
From 100,000 + |
| Transfer Fee Rate (%) |
3 |
5 |
8 |
| First 100,000 (Cyp £'s) |
@ 1.5% |
= 150 |
| Next 50,000 |
@ 2.0% |
= 100 |
| Total Stamp Duty |
|
= 250 Cy £'s |
| Value of Property (Cyp £'s) |
0 - 100,000 |
100,001 - 250,000 |
250,000 - 500,000 |
500,000 + |
| Annual Property Tax Rate (%) per 1000 |
Exempt |
2 |
3 |
3.5 |
