Cyprus

In recent years, property demand has been steadily rising in Cyprus, with a significant portion of purchases by foreigners, including EU citizens and third country nationals such as UK. Foreigners are allowed to buy one home freehold, or a piece of land up to 4,000 sqm (just under an acre).

Unless you are an EU citizen or resident of Cyprus, it is against the law to buy property with the intention of renting it commercially. This is the biggest change for Brits now that the UK has third country national status in Europe. The second change is in the process is permission, which now has to be sought from the Council of Ministers before deeds can be transferred. Your lawyer and agent will help. For those who qualify, rental returns of 5-7% gross are not unusual.

The UK has strong links with Cyprus, where it is estimated some 60,000 Brits reside. The Southern part of the Island, ‘Greek Cyprus’, remains an attractive location for its intense Mediterranean climate, 320 days of sunshine, ease of access, mix of culture, cosmopolitan influence, history and choice of scenery.

The second largest city, vibrant Limassol, on the South Coast, and heart of the wine-making industry, is an ever growing draw. As are the established expat communities around ‘the jewel’ Paphos in the South West, with its long coastline, blue flag beaches, attractive harbour and historical old town. Our affiliate partners have particular focus on these areas, with options around Nicosia, Larnaca, Famagusta and Ayia Napa.

The Government regulates costs of services for residents. There is less VAT to pay on new property if resident too. There are annual taxes. Capital Gains is a flat rate of 20% on both individuals and companies, resident and non-resident, but only charged on the sale of local real estate.

Cyprus has no inheritance tax, but there is a transfer fee, typically 4% between parents to children and 8% between spouses and third degree relatives. There are rules of inheritance so it is advisable to consult a lawyer.

This is a popular retirement location, with rents and cost of living lower than the UK. For non-EU residents, looking to spend longer than three months in any six month period in Cyprus a longer stay visa has to be applied for in advance. There is no retirement visa, but there is a renewable temporary residence permit that is re-applied for annually. After five years, it is possible to apply for permanent residence. However, there are terms and conditions, under review.

There is the potential of permanent residency through investment too, the Cypriot Investor Immigration Permit. Check with the Embassy.

The choice of accommodation is varied, from off plan to new apartments finished to high standard to town houses, villas and traditional stone homes. There are branded residences, golf residences, boutique developments, sea front villas (most sought after), marina residences and high-rise towers.

Allow up to 10% to cover costs of sale on top of purchase price, but this will vary. The process, based on UK law, may take up to three months, but could be faster if buying with cash. Reservation agreements, with small deposit up to €5,000, are normal, and legally binding, so it is advisable to have an English-speaking lawyer on board from the earliest stages. Check there is a legitimate Title Deed for any property of interest. Not all have them in order and it may prove critical.