There are a plenty of reasons to buy property in Cyprus. Cyprus has a perfect Mediterranean climate, great food and amazing views and stunning landscapes. Cyprus offers a high quality of life and has a warm and friendly local population. There are many who buy second homes in Cyprus for the laid back and easy lifestyle here. English is widely spoken in Cyprus and the culture is very friendly to Brits, making them feel right at home.
The best places to buy properties in Cyprus are Famagusta which has great beaches, Limassol, which is a traditional and yet modern city, Larnaca which has a beautiful coastline and Paphos which has a rich and diverse culture. Polis and Latchi are quiet and traditional areas that are very popular, especially with British buyers. Cyprus is always perfect for a romantic getaway. It is safe, largely free from crime and great for families.
The government in Cyprus has done its bit to attract new investors from China and Russia by offering a Golden Visa scheme to non-EU nationals. This would get them residency permits in Cyprus for an investment of €300,000 or more in properties in Cyprus or a citizenship for an investment worth €2.5 million.
The last few years were not easy for the property market in Cyprus. The country has suffered a lot from the global housing crash of 2008 and property prices have declined by 50 to 60 percent since. Many large banks in Cyprus collapsed because of the credit crunch, largely because of their relaxed lending policies.
Cyprus has recovered somewhat because of extensive help from the ECB and the IMF. But property prices continue to remain much lower than in the past, which means there are a plenty of great bargains to be had in Cyprus – you just have to look for them.
Buying Property in Cyprus – How It Works
It is very easy for Europeans to buy property in Cyprus; they can do so without any sort of restrictions. It is easy for non-EU nationals to buy property in Cyprus as well, as the government of Cyprus encourages foreign investment in properties in Cyprus actively, with schemes such as the Golden Visa, which we talked about earlier.
Cyprus is a low tax country and popular for this reason. The only issue foreigner buyers had with buying properties here was that it often took 4 or 5 years to get the title deeds from the Local Council in Cyprus after the purchase of the property.
This was largely because of bureaucratic inefficiency. Their ownership over the properties was never under risk – but it made it difficult for foreigner homeowners to dispose of the property on an immediate basis.
Now, the Cyprus government has cleaned up its laws and streamlined the bureaucracy. Home buyers can now get their title deeds in a matter of weeks. So, this problem has been solved permanently.
The property transfer tax in Cyprus is charged at 3% to 8% of the purchase price depending on the size of the property. This has actually been brought down by 50% in the last few years.
Capital gains tax on the sale of property is fixed at 20%, however, this only applies to properties that are purchased in 2016 and thereafter. Property purchases before 2016 are exempt from this tax.
The old immovable property tax or inheritance tax has been removed, which is another positive change.
Cyprus Property Market Outlook 2016
2016 should be a year of stability for the housing market in Cyprus. The country should witness a slow and steady growth this year. 2016 is a great time to buy a villa in Cyprus as prices couldn’t be lower.