Once you have found your perfect property in Cyprus, agreed your purchase price and Worldwide Lawyers has found your English speaking Cypriot lawyer you are ready to move forward with the buying process.
The property buying process in Cyprus starts with an initial contract (often referred to as a Reservation or Preliminary Contract) which documents a formal offer of purchase made by the buyer. Signing this contract and paying a small deposit of around 1% of the purchase price offered usually ensures that your chosen property will be removed from the market for a specified period. This allows your Cypriot lawyer to carry out checks in relation to the seller, property title and any building permissions required. It is essential that you instruct a reliable independent lawyer to investigate the property title before signing any contract or handing over any deposit.
Once these initial checks have been carried out and the seller has accepted the buyer’s offer, the buyer and seller will then enter into the Sale Contract. The Sale Contract will include all conditions of the property sale and dictates the essential elements of the transaction. Usually a deposit of around 10 (or 20-30% if it is a new build) is payable by the buyer when signing this binding contract. Your lawyer should explain the obligations of each party as a result of entering into this contract before it is signed.
You can either sign the Sale Contract in Person or you can arrange a Power of Attorney for someone else, usually your lawyer, to sign on your behalf. Should you require a Power of Attorney, your lawyer should be able to prepare this for you. You can put the Power of Attorney into effect by signing this in Cyrus in the presence of a Cypriot Notary, through the Cypriot consulates in the UK, or through a British Notary Public with a Hague Apostille.
Once the Sale Contract has been signed your lawyer will register this with the District Land Registry Office. This is an essential element as this commits both parties to the transaction. This confirms the buyer’s ownership before an individual title deed for the property is received. Stamp Duty will be payable by the buyer when depositing the Sale Contract with the Land Registry. Usually the balance of the purchase price is paid to the seller at this point.
Non-Cypriots will need to make an application to obtain permission to buy a property in Cyprus from the Council of Ministers. This can be a protracted procedure taking many months for confirmation of approval to be received. Property transactions can proceed whilst this approval is awaited. You will however need to seek advice from your lawyer as to whether this is advisable in your case. If it is, your lawyer should include the relevant clauses in the Sale Contract to allow for this so that you can take possession of the property without restriction.
Title Deeds known as Certificates of Registration of Immovable Property formally document the property ownership. Each property in Cyprus has an associated Title Deed which contains information such as its registered owner, its size, its location and the Lands’ Office reference.
Whether or not the title deeds will be immediately available for transfer into your name will depend on several factors such as the age, location and previous ownership of the property. It is not uncommon for it to take several months if not years to issue the new title deeds to the purchaser. Because of this, new Specific Performance Laws were enacted in 2011 in order to provide some safeguards for people purchasing property in Cyprus. The act of registering the Sale Contract with the District Land Registry invokes the buyer’s right of Specific performance. This essentially means that the seller is prevented from mortgaging, charging, reselling or otherwise interfering with the buyer’s rights to the property, until the separate title deed is ready. Once the Transfer Deeds are available, the seller must transfer the deeds into your name.
Once the Title Deeds have been drawn up, all parties, or their lawyers, meet up at the District Land Registry Office to pay the land registration transfer fees which are payable by the buyer. This transfers the property from the vendor to the buyer.
The next step is to enjoy your new property in Cyprus relaxed in the knowledge that your independent lawyer has taken care of all legal formalities and your interests have been protected. Congratulations!