Buying pocedure

The real estate market in Cyprus has grown in recent years, mainly due to foreigners. Cyprus offers many different advantages that make it an ideal place for foreigners and young entrepreneurs to move to.

Step-by-step instructions.

Acquisition of real estate in Cyprus is possible remotely, or rather the Buyer can acquire real estate in Cyprus without being in Cyprus. This procedure is completely legal and is subject to all legal provisions of Cyprus regarding the legislation on the acquisition and transfer of real estate. The local legislation is largely based on the British equivalent and protects property buyers in various aspects.

Step1

Choose a professional real estate agency in Cyprus. There are several factors to consider when choosing a company:

Work Experience

Yes, it's not a one hundred percent guarantee of the quality of the agency's work, but it's an indicator of a diverse base of facilities, competence and sophistication.

Reviews

A great way to learn about the agency's work in practice is to read reviews. But be careful with your conclusions, be able to distinguish constructive criticism from consumer terrorism.

Business Reputation

Companies that value their reputation have a high level of service. Look at the agency's media mentions, advertising activity, and website. Clarity and openness A good agent is always friendly, but not intrusive. Pay attention to the questions you are asked.

License

Always check the agency's license - this is your guarantee that the real estate and related documents when buying a property will be in order and thoroughly checked. And it greatly minimizes the chance of encountering incompetent agents or scammers.

Step2

Determine your purchase objective, property type and budget.

As with any major purchase, you should start with determining the budget - the amount will depend on the distance from the central part of town, house class, living space. As a rule, the main purpose of buying an apartment just two: for yourself (for your children, parents), for the purpose of living, or investment, -- investment funds with subsequent income. For each of these purposes different criteria of the required apartment will be applied. At the same time, the basic steps of buying an apartment will be the same.

Step 3

Choose a property

The property selection process can also be done remotely and can take varying amounts of time. It usually does not take more than a week.

If you have found a suitable property and are ready to buy it, a deposit of between €5,000 and €20,000 must be made for the selected property. The reservation depends on the value of the property. When you make the reservation the buyer receives confirmation of the payment. Once you have paid the deposit, the property is taken off the market and reserved for you.

Step 4

Choose a lawyer to support the transaction and sign an agreement with him.

The purchase of real estate is a definite legal process and one cannot do without the help of a lawyer, as it is very important to carry out the required inspections and prepare the necessary package of documents for the transaction. The lawyer is also responsible for checking the purity of the transaction, drawing up a contract, registering the property at the Land Registry Department and re-registering the title deed. The buyer concludes a legal services contract with a lawyer for the legal support of the transaction and provides the lawyer with the necessary power of attorney certified by a local notary (a copy of the passport and the buyer's signature are required for the preparation of the power of attorney and the contract). This power of attorney will allow your lawyer to complete the transaction without your personal presence.

If the buyer is abroad, the entire procedure can also be carried out under a Power of Attorney, which can be signed and certified at the Embassy or Consulate of Cyprus in the country where the buyer resides. You can ask for help from your specialist or use the services of our lawyers

Step 5

Sign the contract of sale (in Greek or English)

The contract is made in 3 copies: one copy stays with the seller, one with the lawyer, and the third is registered with the Land Cadastre Department. Once all the preliminary steps have been completed, the buyer and seller sign the contract of sale.

The contract must state:

amount
method of payment (with details, if paid to the buyer's account)
payment terms
deadline for closing the deal
all terms of the deal

Also, in practice, 20 to 30 percent of the value of the property is paid at the signing of the contract and the balance is paid at closing.

If the property is under construction, the balance is broken down into 6-7 payments depending on the stages of construction and when the property is delivered.

Registration of the contract of sale with the Land Department:

When the contracts are signed, the buyer's legal representative delivers the signed contracts to the Department of Internal Revenue for printing. Next, you will need to pay a one-time "Stamp Duty" tax, which is payable on the contract of sale depending on the value of the property
When the signed contracts are stamped, the buyer (or his attorney or representative) must take them to the Land Department for filing/registration for further action.
The Land Office stamps the contract and records it in the Land Registry. This secures the buyer's ownership until the title deeds (Title Deed of Ownership) are issued.

Step 6

Stamp Duty

Immediately after signing, the lawyer must pay the stamp duty, which depends on the value of the property and is between 0,15% of the first €170.860 and 0,2% of the remaining amount exceeding €170.860n. Also, one copy of the contract is registered at the Land Registry Office and the Buyer is given the contract registration number (ΠΩΕ). And the last step is to re-register the Title Deed of Ownership.

Step 7

Owner's Title

After signing and registering the contract with the Land Registry Department, the seller's lawyer is required to prepare certificates of no debts, including no debts in the tax office related to the property. Without these certificates, the seller will not be able to transfer the Title Deed to the buyer. At the same time, the buyer's lawyer prepares an application and the necessary documents to obtain permission from the Council of Ministers of Cyprus to purchase the property. This procedure is a formality and the certificate is issued within 2-3 weeks

The purchaser must pay the Transfer Tax, which is calculated on the assessed value of the property:

up to 85,000 € - 3% of the value of the object
From 85,000 € to 170,000 € - 5%
over €170,000 - 8%

A rule has been approved by the Parliament of the Republic of Cyprus to waive or reduce the re-registration fee which gives the following advantages:

For buyers whose properties are not subject to VAT, the fee for reissuing a Title Deed of Ownership has been reduced by 50%.
Buyers whose properties are subject to VAT will be completely exempt from paying the Title Deed reissue fee.

Once the Title of Ownership has been reissued - the keys are transferred to the new owner of the property (the new owner) and the transaction is considered closed.

Step 8

After the successful completion of the sale, the buyer can move on to processing a permanent residence for himself and his family.

The purchase of real estate is a definite legal process and one cannot do without the help of a lawyer, because it is very important to carry out the required checks and to prepare the necessary package of documents for the execution of the transaction. The lawyer is also responsible for checking the purity of the transaction, drafting the contract, registering the property with the Land Registry Department and reissuing the title deed.

Important to know

VAT (value added tax) on land for development

VAT (value added tax) at the standard rate of 19% on the sale and purchase of land for development. VAT (value added tax) is charged in cases where the land is sold for one or more buildings, and the sale refers to the economic activity of a person. Note that the purchase and sale of land is not subject to VAT in cases where the purchase and sale is a random transaction.

Cyprus Capital Gains Tax.

Cyprus Capital Gains Tax is levied (when the sale is not subject to income tax) at a rate of 20% on gains from the sale of immovables located in Cyprus, including profits from the sale of shares of companies that directly own the property.

Tax exemption for real estate transactions

The following types of real estate transactions are not

subject to capital gains tax: Land or land with buildings acquired between July 16, 2015 and July 31

December 2016 are exempt from this tax

(subject to certain conditions)

sale, Transfers arising from death, Gifts given by parents to a child or between

husband and wife or between relatives up to the third

degree. Gifts from a company whose shareholders

are members of the family of the giver, Gifts of the family company to its shareholders.

Exemption from capital gains tax

Individuals may deduct the following from capital gains: costs associated with the purchase and sale of real estate are also deductible under certain conditions, such as real estate agency fees, money transfer fees, legal fees. Lands or land plots with buildings purchased between July 16, 2015 and December 31, 2016 are exempt from this tax (under certain conditions) when they are sold.

Death-related transfers.

Gifts made from parents to a child or between husband and wife or between up to the third degree relatives. Gifts from a company whose shareholders are members of the donor's family. Gifts from a family company to its shareholders.

Expropriation of a mansion (under certain conditions) €85,430 Expropriation of agricultural land by a farmer €25,629

Any other expropriation €17,086

Note. The above points are lifetime exemptions with a total lifetime maximum of €85,430.

Cyprus Capital Gains Tax Calculations

The Cyprus inheritance tax was abolished on 1 January 2000 and is no longer applicable.

There is no property tax in Cyprus.

Let's find the perfect property!

Buying pocedure

Step-by-step instructions.

Important to know

Let's find the perfect property!

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