Acquisition of immovable property
As international investors you can benefit from a range of advantages when acquiring real estate in Cyprus. Some of the major advantages include the eligibility for residency and citizenship.
Cyprus’ geographical situation in the eastern Mediterranean at the crossroads of Europe, Asia, the Middle East and Africa, its reliable and transparent legal system combined with the relatively low cost of living, the high quality of lifestyle, its excellent climate and the friendliness and hospitality of its people are just a few factors that have made the small island of Cyprus as one of the top destinations for retirement.
We are able to help you with swift legal advice to matters related to Property Law and Land Acquisition such as:
- Drafting and execution
- Governmental and local authority licensing and permits
- Planning Office and the Land Registry procedures
Below you will find some useful legal information about the procedure:
The Legal System in Cyprus is generally based on the common law and our legislation is largely based on the British equivalent. However, Cyprus Legislation differs from the UK one in the area of Immovable Property. The ultimate law of Cyprus, which is its Constitution safeguards the protection of ownership and establishes the equality of all persons and the respect for human rights. Subject to the Cyprus Law, Cypriots as well as foreigners have the right to enjoy all rights relating to ownership of their property without any interference either from the State or from individuals.
The Property Conveyancing Process
The conveyancing process in Cyprus is fairly complicated. The buyer and the seller needs to go through various checks to identify the background of the respective property. The system however, is designed to enable the buyer to be notified of any restrictions prior to the purchase of the respective property or land.
The negotiation starts with the buyer’s lawyer reviewing and possibly amending the contract of sale to safeguard the interests of the buyer. The buyer’s lawyer will also carry out a number of searches to ascertain the background of the property.
Once the Contract of Sale is agreed between both the Seller and the Buyer, both parties will sign the contract and four copies are made and stamped at the Land Registry Office. One of these copies is stamped ‘original’ and will usually be kept by the buyer’s lawyer. The remaining copies are stamped, with a Revenue Stamp and certified as being true copies of the original. One of the copies is registered with the Land Registry for reasons of ‘Specific Performance’ as it was explained above.
Deposit contract of Sale
The buyer’s lawyer will then deposit one of the copies of the contract of sale with the Land Registry for reasons of ‘Specific Performance’. This is a vital stage for the purchaser’s protection.
‘Specific Performance’ is a simple and effective legal instrument provided by the Land Registry in Cyprus through which the purchaser’s ownership rights are protected until the title deeds are issued and transferred to their name. Through this simple procedure, the contract which is in the hands of the Land Registry, cannot be withdrawn by anyone and therefore the respective property cannot be leased, sod, transferred or mortgaged. Therefore, this status can only be altered by the purchaser.
Your lawyer will ask you to pay an amount of Stamp Duty. This is payable by you when you sign the contract. The rates are as follows:
- € 1.50 per thousand for purchase prices up to € 170,860 and
- € 2.00 per thousand for the part of the purchase price exceeding € 170,860
So for a property costing € 256,290 the Stamp Duty payable by you is € 427.15.
Transfer fees are payable by the purchaser for registering the acquired property on his/her name. Property transfer fees are calculated on the basis of the property’s market value on the date of purchased. This requires that the sale of contract be deposited at the Land office. For registering the property under his/her name the purchaser is liable to pay the following transfer fees, calculated according to the property market’s value:
|Property market value||Transfer Fee rate|
|Up to €85.430||3%|
|From €85.431 to €170.860||5%|
*The Cyprus Government currently offers 50% discount on the transfer fees for an unlimited period of time.