The Cyprus property market has been under pressure for some time amid concerns about not only the issue of title deeds but also the fact it tends to be considered in the same breath as Greece. Thankfully, amidst a little pressure from the European Union, the Cyprus authorities are set to introduce laws to protect those acquiring property and ensure that they receive their title deeds in a timely manner. The issue of title deeds has caused major problems across the Cyprus property market although thankfully a resolution seems to be just around the corner.
It is the fact that Cyprus is awaiting the next €500 million instalment of its bailout crisis loan from the European Union which has focused the minds of the authorities. The European Central Bank and International Monetary Fund have also been very vocal in their criticism of the Cyprus property market which has added to the pressure. Politicians are now on a mission to ensure those acquiring property in the future receive their paperwork on time and those who acquired property in the past, but never received their title deeds, are protected.
While many property investors hope that the ongoing activities within the Cyprus property market will lead to a new period of prosperity the authorities have also introduced a number of fiscal incentives. Those who acquire property in Cyprus up until the end of 2016 we receive a 50% reduction on the property title deed transfer fee tax. They will also be immune from capital gains tax on properties acquired during this period which at this moment in time offers a potential saving of 20%.
In many ways it is the title deed issue which has reignited interest in the Cyprus property market and now hopefully all of the other “benefits” will receive full recognition.
Increased interest in Cyprus property
As we await the title deed and fiscal incentive schemes to be rubberstamped by the Cyprus parliament, real estate agents are already reporting increased interest. There seems to be significant interest from the UK with investors looking to make use of the relatively strong pound. It is also worth noting that private pensions are only taxed at 5% when living in Cyprus which to those looking to retire to a warmer climate can make a massive difference.
Looking back this is probably the changes that investors have been waiting for because like so many real estate markets in the region Cyprus has struggled of late. We will no doubt see an array of investment reports in the short to medium term highlighting the particular issues impacting Cyprus property prices. This in itself is likely to encourage more interest in the region and once other investors see the market beginning to turn we could see momentum begin to build.
The Cyprus property market has been overshadowed by a number of issues including the title deed problems of years gone by as well as its often unwanted association with Greece. The final resolution of the title deeds issue together with an array of fiscal incentives has already increased demand for Cyprus property. After years in the doldrums the Cyprus real estate market is certainly one to monitor.