Guide to property purchase

Before you have decided on a property in Cyprus it is important to be fully aware of the legal process and costs involved in your property purchase. The following is intended as a guide only and is no way a substitute for professional advice.

- Residential Permit
Residential permit is easily obtained for people living in Cyprus and who have purchased a property in Cyprus The applicant needs to submit an application and give evidence of secure annual income that supports him and his family. In addition, the applicant must submit:
a) A copy of the sale or rental agreements
b) Copies of pension or retirement income
c) Any other relevant income documents
d) Passport and three photos
The above application and documents may be submitted to the local immigration office in the area of residence

-Property Ownership by Foreigners
(Non-Cypriots are entitled to a freehold ownership of a house, apartment, or a piece of land not exceeding the 4014sq.m for personal use.
International business units may also acquire premises for their activities or for residence of their foreign employees.) Cypriots or persons of Cypriot origin are allowed to purchase immovable property without any restrictions.
EU citizens are free to purchase property just as local persons, but for a second home there is a restriction in that permission has to be granted by the Cyprus government. The restriction for a second home will be lifted from the 1/5/2009. After this date all EU citizens will be allowed to purchase whatever property they wish just as locals.
Aliens however are entitled to a freehold ownership of one house or one apartment or a building plot or land not exceeding the 4,014 sq.m.
The procedure to be followed by an Alien acquiring Property:

a) Application to the Council of Ministers or to the District officer of the area the property to be purchased is located
Once you have signed the property ownership process and all parties have signed the sales contract, a written application to the Council of Ministers has to be made in order to transfer the property into your name. The above application should be completed and submitted to the district officer of the area the property is situated. The information required to complete this form is as follows:
* Personal details of the applicant and his financial status
* Particulars of the property
* Particulars of the present owner, the sales contract and terms of payment
* The type of acquisition, whether freehold, long lease, by shares etc.

This might be a slightly long process; however it does not delay the owner from enjoying the property. In most cases your solicitor will prepare your sales contract and make your application to the council of Ministers.

b) Application to the Central Bank
On receipt to the approval from the District Officer to acquire the property in question, an application should be submitted to the Exchange Control Officer to confirm that the purchase was paid for in a foreign exchange. This application should be submitted with the following:
* Copy of receipt or evidence of the foreign exchange importation. The Central Bank of Cyprus will provide the required certificate, evidencing that the said purchase was paid for in foreign currency. * The sale contract
* Copy of the Ministerial Council's permission to acquire the said property
* Title Deeds of the property if available

c) Application of transfer of ownership of the District Land Registry
The transfer of ownership is completed with a simple procedure at the District Land Registry. The above application should be submitted in person to the Land Registry together with the following:
* Title Deeds of the property
* A copy of the Ministerial Council's permission to acquire the said property
* The Central Bank's certificate evidencing that the property was acquired using foreign currency.
* Receipts of payments of all property taxes to date (these taxes may include town taxes, sewage tax and road construction tax)

The buyer is liable for the payment of the determined transfer fees

According to the cost of the property the following amount is paid out for the transfer:

Up to 50000 CYP 50000-100000 CYP 100000 CYP and over

3% 5% 8%

-Appointing a solicitor
You are free to use a solicitor of your choice or we can recommend one of the local area

-Applying for a Mortgage
The local banks in Cyprus offer a variety of loans either in Cy£ or foreign currency. The normal charge is the basic +2%. In the case of a mortgage, then there are mortgage fees involved, which are calculated at 1% on the mortgage amount.

-Stamp Duty
Unless otherwise stated in the sales contract, the buyer pays all stamp duty Fees at the rate of £1,5 per thousand of the value up to CY£100,000. Over this amount the fees are £2,0 per thousand. The documents should be stamped within 30 days after the signing in order to avoid the payment of a fine, which could be a substantial amount of money.

-VAT
VAT is applicable, currently at the rate of 15%.

-Tax advantage
Cyprus is one of the lowest taxed countries in the World and the least taxed amongst the EU members.
For all Cypriot tax residents their total annual income up to 10,000CYP is tax exempt.
In addition Cyprus has double taxation treaties with many countries, so that its residents don't pay tax in both countries. Cyprus has signed 26 such treaties, regulating in effect tax relations with over 40 countries.

Some of these countries are: Austria, Bulgaria, Canada, Republic of China, the Czech Republic, Denmark, Egypt, France, Germany, Greece, Hungary, India, Ireland, Italy, Kuwait, Malta, Norway, Poland, Romania, Russia, Slovakia, South Africa, Sweden, Syria, the United Kingdom, the United States and Yugoslavia.

-Duty Free
Household Goods, furniture and other items can be imported free, provided that they are for personal use. There is no duty on a car. In addition couples in their retirement can enjoy an additional concession of two Duty-Free cars.

-Retired Residents
A series of incentives is give by the Cyprus Government to retired people, including duty-free facilities and very low taxation of their income which emanates from abroad. In addition retired people can enjoy the benefits of Double Taxation Treaty of Cyprus with their country of origin, if there is one.

-Selling your property
Due to the fact that Cyprus is a popular destination for thousands of people it is very easy to sell your property. There plenty of proficient Estate agencies in the island that will help you resell your property. M&M Eutopia Properties Ltd can assist you for that matter.

-Legal System
The legal system in Cyprus is mainly based on the British as well as the Greek legal system. Most laws are translated into English. In addition, the Land Registry is also based on the British one, which is probably one of the most reliable and advanced system in the world.
Legal fees are much more reasonable than other European countries.

-Banking Standard
The banking system in Cyprus is close to British system. They are all well organized and well equipped with the latest technology.
Non-Cypriots have the privilege to open foreign currency and local deposits without difficulty.
Cyprus banks offer flexible housing loans in foreign currency to suit a client's needs.

-Standard of living
Cyprus provides a fairly high standard of living, reaching that of 70% of the EU average, and a rather low cost of living. The annual per capita income is about US 17,000.

-Climate and temperatures
Cyprus enjoys the best Mediterranean climate with approximately 340 days of sunshine per year. Swimming season usually starts from April and goes on until November.

-Languages
The local population is Greek speaking. Over 80% of the habitants in Cyprus speak fluent English. English signs in the streets are also written in most areas. Russian, German and French are widely spoken too.

-Family pets
You can bring your cat and dog along with you at your new home, provided that they have had all their vaccinations.