Real Estate Lawyers: Protect your rights and be safe
Even if you are an investor or just and individual, you are in the right place and you are about to start Real Estate business with the right real estate lawyers in Cyprus which will make your life easier on the island of Cyprus.
The real estate market in Cyprus is an integral part of the country’s economy. Property prices in Cyprus are very attractive and much lower than other European and third countries.
The land area of the country is small, which allows easy and quick movement to any part of the island.
Although Cyprus is one of the best countries in the world to choose as a permanent residence especially for retirees, it is also an excellent choice for buying real estate for investment purposes, as the return on your investment is quick and the taxation on rental income is extremely low, something that is not the case in other European countries.
For example, an investor makes an investment of €80,000 to buy an apartment with a rental value of €600 per month, then the investment is amortized over 11 years.
However, if you are interested in a larger type of investment, we would recommend buying land and developing real estate and housing units. Our office can, through our network of partners, find for you the right property as well as undertake the entire process of developing residential units.
In recent years, there has been a great interest from citizens of eastern countries (Russia, China, etc.) in purchasing real estate in Cyprus for investment purposes as well as for private residence.
What attracts most third-country nationals to Cyprus is the low cost of living, the safe environment, the sunny and warm climate as well as the many financial benefits they enjoy when they acquire their Cyprus Tax Residency.
Our Law Office undertakes to find the right property, from the right seller and at the right price to suit you.
We also undertake to provide advice related to rentals and/or developments of your properties.
We have established a well-connected network with local developers and real estate agents which can assist in our mission, to keep our clients happy and keep their costs low.
The Immovable Property Law Cap 224
It is one of the main Laws of the Republic of Cyprus which has been in force since 1946 and is based on Anglo-Saxon Common Law, which is why there are many similarities with Real Estate Law in the United Kingdom.
This Law regulates all matters concerning the registration, disposal, possession, assessment and valuation of immovable property which is registered in the Land Registry of Cyprus.
The Department of Lands and Surveys in Cyprus
The Department of Land and Surveys is subject to Control by the Ministry of the Interior of Cyprus and was founded in 1858. However, it is one of the most innovative and easy-to-use services in the whole of Europe, since their Online platform offers great facilities to the public, which save time and money .
Some examples are the registration of various applications through the Government platform, navigation of live maps and real estate research, surveying and surveying, calculation of various fees (such as transfer fees) and various other facilities.
The services offered by the platform provide security to real estate buyers since with the DUE DILIGENCE conducted your Lawyer, all the necessary information can be found to carry out the purchase or sale of the property safely.
Also a very important safeguard is the registration of the Contract of Sale (drafted by your Lawyer) in the Land Registry, which gives the buyer rights over the real estate (more on the Contract of Sale below).
Real Estate Market in Cyprus
Buying real estate in Cyprus can be risky when it is carried out without first consulting your lawyer, who will carry out the necessary investigations and advise you on the procedure to follow.
There are also cases where the buyer buys a property that is under construction. In such cases it is extremely important that before any down payment is paid, the terms of the purchase of the property are agreed in writing, in an agreement that will be prepared by a Lawyer who knows the risks and what to look out for.
Some common terms of such an agreement can be regarding the time of delivery of the property, the time of repayment of the installments, the materials that the contractor will use, any additions that you have agreed to make and other terms that are important so that you do not have any negative consequences in future.
In the event that you are given any document and/or agreement to sign, DO NOT under any circumstances do so before your Attorney has reviewed it and advised you accordingly.
Land Registry Research and Due Diligence
Once you have appointed the Lawyer of your choice, the process begins with the search in the Land Registry and the due diligence check regarding the property you are interested in.
This check tends to ascertain whether the property you are interested in buying has any legal issues such as:
- Encumbered by any Mortgage or other encumbrance.
- Pending any fees to be paid, to the Government or a third party.
- The property is the subject of a legal dispute.
- There is more than one owner (the seller does not have absolute ownership of the property).
- Title deed is Available and will be transferred to the buyer.
- There is no pending partition of any block.
- It is not enclosed and there is normal access to the property.
- All the Licenses are issued correctly and up to date.
- Any other peculiarity of the property may affect its purchase.
Agreement for the reservation of the property
After the necessary inspection and due diligence has been carried out by your Lawyer, you can now “hold” the property by signing a retention agreement and paying a small amount of money (deposit) to the owner.
By signing the property reservation agreement, the seller stops advertising the property, or accepting or showing the property to new prospective buyers, accepting offers and generally taking any action related to the property in question. The amount of the deposit to reserve the property usually amounts to 1-2% of the total selling price of the property.
The property reservation agreement is drawn up by your Lawyer and signed by the parties (buyer and seller) in order to allow time until the sales contract known as the “Purchase Agreement” is drawn up and signed.
Agreement for the reservation of the property
After the signing of the “reservation contract”, the Lawyer draws up the Purchase and Sale Contract which meets the needs of your case and the particularities of the property and the factors governing the sale.
After the Purchase and Sale Contract is drawn up and signed, we register the Contract with the Land Registry Department. In order to make the deposit to the Land Registry Department, the Contract must first be validated by the Internal Revenue Department after it has been previously stamped.
After the Contract has been ratified, it is now submitted to the Land Registry Department for registration for the purposes of special service.
When the Land Registry Department seals the Contract and records it in the Land Registry system, the buyer secures ownership rights until an independent title deed is issued. With the deposit of the Contract, the Agreement is now “locked” and the buyer acquires legal rights to the property and the seller / owner loses the right to transfer the property to another person.
If one of the contracting parties (buyer or seller) is abroad, the process can be completed by appointing the Lawyer as a Power of Attorney who will sign all the necessary documents on your behalf.
If the buyer of the property does not hold the Cypriot Citizenship, the Lawyer should request permission from the Council of Ministers for the purchase of the property, at the time of signing the Contract of Sale.
If one of the contracting parties (buyer or seller) is abroad, the process can be completed by appointing the Lawyer as a Power of Attorney who will sign all the necessary documents on your behalf.
If the buyer of the property does not hold Cypriot Citizenship, the Lawyer should request permission from the Council of Ministers for the purchase of the property, at the time of signing the Contract of Sale.
Transferring Ownership of Property in Cyprus
With the transfer of title, ownership of the property is acquired by the buyer and he now becomes the absolute owner of the property. If it is a resale or purchase of a second-hand property for which the title already exists, the transfer is immediately made in the name of the new owner.
If the property is new, i.e. newly built, it is common that it does not yet have an independent title deed for the property you have purchased. Until the independent title deed is issued for the property, your rights as an owner are secured by filing the Sale and Purchase Agreement with the Land Registry Department.
The transfer of the property is subject to transfer fees which are usually paid by the buyer.
The transfer fees are exempt from any transfer fees where VAT is required to be paid to purchase the property.
The VAT for the purchase of real estate in Cyprus generally has a rate of 19% when selling new real estate. Property resellers are usually exempt from VAT and therefore the buyer is responsible for the transfer fees. We can calculate your transfer fees for free.
Reduced VAT of 5% when buying residential house in Cyprus
Buyers purchasing their FIRST property for residential purposes can apply for a reduced VAT rate of 5%. This rate applies to the first 200 square meters of covered surface of the property. The remaining square meters are subject to the standard VAT rate of 19%.
When dealing with plots of land and fields (where there is nothing built on) VAT is only imposed when the sale is made in the context of the Seller’s business activities, i.e. it is made for profit and repeatedly and it is not just an occasional sale.
Real Estate Lawyer in Cyprus – Services
Our Law Office provides the following services related to the purchase of Real Estate in Cyprus:
- Due diligence and control of the Land Registry.
- Advice on property value, location, prospects.
- Drawing up a property reservation agreement.
- Advice on the procedure to follow.
- Drafting of a Purchase and Sale Agreement.
- Reviewing and explaining contracts you are asked to sign.
- Preparation of a power of attorney for the purchase and sale of real estate.
- Securing a property purchase permit (for non-Cypriot citizens).
- Preparation of real estate rental contracts.
- Securing a building permit and urban planning permit for the construction of a residence.
- Mediation to secure a loan from a Bank for the purchase of a property.
- Registration of MEMO on real estate.
- Claiming real estate resulting from spousal property disputes.
- Distribution of real estate in execution of the will of a deceased person.
- Transfer of real estate to a trust (Trust).
- Real estate management.
PROTECT YOUR PROPERTY RIGHTS
Dealing with Real Estate might be dangerous if your don't have the appropriate guidance.
Legal Aid Available
Legal aid is available to any natural person, including citizens and foreigners, who can demonstrate an inability to pay for legal costs without compromising their basic needs or obligations to their family