Buying a property in Cyprus can be complicated, so it’s advisable to seek the advice of an independent lawyer early in the buying process to guide you through the property buying system in Cyprus.
There are four key steps to buying a property in Cyprus:
1. Preliminary Contract in Cyprus
When buying a property in Cyprus initially you will be required to sign a Preliminary Contract (also often referred to as a Reservation), which is a record of the formal offer by the buyer. At this stage you’ll usually be required to pay a deposit of approximately one per cent of the property purchase price, which ordinarily ensures that the property will be taken off the open market. Removing the property from the market allows you the opportunity to instruct your lawyer to in Cyprus to carry out all the relevant checks on the property.
Instructing a reliable Cypriot lawyer who is not linked in any way to the seller (i.e. estate agent, developer etc) is essential before signing any contract or paying any deposit, to ensure that necessary searches are carried out and that the contract is drafted properly and will enable you to pull out and get your money back if it turns out that there is a problem with the property. If there are any issues relating to the property your lawyer can offer advice accordingly to protect your interests.
Your Cypriot lawyer should be a specialist in property law in Cyprus. They will also advise you of the full costs associated with buying a property in Cyprus at this stage.
2. Sale Contract in Cyprus
When these preliminary checks have been carried out, any potential issues have been ironed out and the buyer’s offer has been accepted, your lawyer will draw up the Sale Contract. This contract details the conditions of the property sale and a deposit of around 10 per cent is payable at this stage. If the property is a new build a deposit of or 20-30 per cent is required, 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.
Once the Sale Contract has been signed by both parties your lawyer in Cyprus will register this with the District Land Registry Office within the timeframe outlined by the law, which means both parties are formally committed to the transaction.
The act of lodging of the Sale Contract at the Land Registry Office protects the buyer’s rights until completion and ensures that the seller is not able dispose of the property prior to the new owner receiving the title deeds.
At this stage the buyer will also need to pay the stamp duty and usually the balance of the purchase price is paid to the seller as well.
3. Application to the Council of Ministers
A non-Cypriot requires permission from the Council of Ministers to complete the transfer of property into their name, with the exception of EU-citizens who live in Cyprus on a permanent basis. The application is a mere formality and legitimate applications are usually approved promptly without any issues.
To make an application to the Council of Ministers the relevant paperwork must be taken to your nearest District Administration Office, which are located in Famagusta, Nicosia, Larnaca, Paphos and Limassol. Your lawyer can make this application on your behalf and they often include this service in the standard charge for legal fees.
4. Receiving title deeds for the property in Cyprus
Finally, receiving the title deeds (known as Certificates of Registration of Immovable Property in Cyprus) formally marks the transfer of ownership of the property in Cyprus.
It is not uncommon for the transfer of title deeds in Cyprus to be a prolonged and complicated procedure, taking several months, or even years in some cases! The reason for this is that the Cypriot legal system requires that every sale of property must go through the tax system, which can be a lengthy process. On the positive side, because of this system the Cypriot government has put safeguards in place to protect buyers, which ensure that the seller is unable to remortgage, charge or resell the property or interfere otherwise with the buyer’s rights to the property, until the new title deed is ready.
Once the title deeds have been drawn up, the final stage involves all parties (or their lawyers) meeting at the District Land Registry Office. Here the buyer must pay the land registration transfer fees which finalises the transfer of the property from the vendor to the buyer.
After that, it’s a case of sitting back and enjoying your property in Cyprus with a meze platter and glass of Cypriot Zivania perhaps?!
For more information about buying property in Cyprus check out our guide to Buying Property in Cyprus. You can also call us on 01244 470339 and email us on firstname.lastname@example.org – our friendly team will be happy to offer FREE initial advice about buying property in Cyprus!
We can also put you in touch with a recommended independent English-speaking lawyers in Cyprus, as well as currency exchange specialists (find out how they can save you thousands!) and international mortgage specialists to help your property purchase in Cyprus be as smooth and hassle free as possible.