Cyprus Property Acquisition 

Prior the purchase of a property the potential buyer must carry out due diligence and proceed with caution to avoid any future complications. 
  1. The Buyer should obtain a valuation and conduct a search at the Land Registry to find out whether the property is subject to any mortgages, memos or other encumbrances. Should the property is mortgaged or subject to a memo or any other prohibition, before the buyer proceeds with the purchase, the seller must prove they are able to make the necessary arrangements so that the property is free at the date of the transfer. 
 
  1. The potential buyer must inquire whether any prohibitions affect the seller, either bankruptcy or an interim order, or whether he has any tax liabilities. 
 
  1. The buyer should also verify with the Town Planning and Building Authority the prospects for the development of the property, whether it is affected by any planning scheme and its building density. 
 
  1. In the event that the property constitutes a house or an apartment under construction, the buyer must be provided with a copy of the town planning and building permits or if it is a property without a separate title deed, to ask for a copy of the aforesaid permits, the division permit and a copy of the architectural plans. 
 
  1. Buyer should check whether the property is subject to VAT.
 
  1. The signing of a contract must come after due diligence and only upon transfer should payment be made. 
 
  1. The sale contract to be deposited immediately, since any delay may create problems, such as the registration of encumbrances in the meantime having priority over the sale contract.
 
  1. When a property is to be purchased from a person who is not its registered owner, but instead from a buyer under a sale contract, the potential buyer should confirm that the person selling the property lodged a sale contract and does not owe any money to the original seller, who must declare that he has made arrangements to pay the relevant capital gains tax, if any. Provided the requirements are met and a tax clearance certificate is obtained, the sale can be made through an assignment agreement, on which the signatures of the assignor and the assignee must be certified. 
Purchase of Property is executed after the parties sign the contract of sale. There are some general points to check before signing a sale contract to make sure the transaction is fair. These include:
  • 50% deposit paid on the signing of contracts
  • 49% on delivery of property or in stages if under construction
  •  1% on transfer of title deeds
To ensure that the buyer is legally protected, the following actions must take place:
  • The buyer must sign a valid contract of sale for property free of any legal and financial commitments.
  • The contract must be signed, stamped and registered with the Land Office. This prevents the seller/developer from reselling or mortgaging the property before the transfer of title.
  • The buyer is entitled to take possession of the property prior to the title transfer.
After the contract of sale is signed, the purchaser is liable for the payment of stamp duty as follows: Contracts with a fixed amount as from 1st March 2013:
  The first €5.000     0
  The first €5.001 - €170.000     1.5%
  Above €170.000     2%
  Contracts without fixed sum     €35
The transfer of ownership is effected by a simple process of registration with the District Land Registry Office. The prescribed application form N270 should be completed for submission in person to the District Land office together with:
  • The registration certificate (title deed) of the property.
  • Copy of the Council of Ministers’ permission to acquire the said property.
  • Written confirmation from the Central Bank of Cyprus that purchase is done by foreign funds.
  • Evidence of payment of all property taxes to date (these taxes may include sundry municipal/local authorities taxes and sewage tax).
  • The contract of sale duly stamped.
The buyer and seller may give specific powers of attorney to any third party to attend and effect the transfer on their behalf. Upon transfer of the property and registration in the buyer's name, the District Land Registry Office will charge transfer fees, which are based on the market value of the property at the time of the purchase and are calculated as follows:

 
Current Market Value Rate % Fee Accumulated Fee
First 85.000 3 2.550 2.550
85.001 – 170.000 5 4.250 6.800
Over 170.000 8    
  The land transfer fees are payable by the purchase of the property.

  No transfer fees are payable if VAT is applicable upon purchasing the property.  

The above transfer fees are reduced by 50% in case the purchase of a property is not subject to VAT.

If the property is transferred to a family company, transfer fees are refundable after five years if the property remains with the company and the shareholders remain the same.

In case of companies’ reorganizations, transfers of immovable property are not subject to transfer fees or mortgage registration fees. 

 In addition, there are no transfer fees payable under a qualifying Loan Restructuring process or in the context of bankruptcy, liquidation, disposal of mortgaged immovable property by the lender, where the sales proceeds do not exceed the amount of €350.000 per owner.

In the case of free transfers of property, the transfer fees are calculated on the value of the property as at 1st January 2013 as follows:
  • From parents to children: Nil 
  • Between spouses: 0,1%
  • Between third degree relatives: 0.1%
  • To trustees: €50
  • Mortgage registration fees are 1% of the current market value.

Contact Us

    contact form
    en_GB