THE PROCEDURE FOR PURCHASING IMMOVABLE PROPERTY IN CYPRUS
For the purchase of property in Cyprus by non-Cypriots the following procedure must be followed:
Contract of Sale
The lawyer is responsible for drafting the contract and inserting the fair terms and conditions for the protection and interest of the buyer. The lawyer will also examine the deeds of the property sold.
Once the contract is signed the purchaser is responsible for the payment of stamp duty at the rate of €1.50 per thousand towards the purchase price up to the value of €170.860,14 thereafter the rate is €2.00 per thousand. The contract must be stamped within 30 days after its signing in order to avoid the payment of a fine.
Lodging a copy of the Contract of Sale with the Land Registry Office
As from the date of signing the Contract of Sale the buyer has the right within 60 days from that date to lodge the contract with the Land Registry Office for what is called specific performance purposes. This is very important for the protection of the buyer mainly for two reasons. First, the Land Registry Office is a aware of this transaction and his interest is protected i.e. his contract has priority over other purchasers who sill try to lodge it after him.
The second main reason is to secure that the title deed will be passed to the buyer even if the vendor is not willing to act for that purpose. Title deeds usually are ready in approximately 3 years after completion of the whole project, which is considered a standard practice in Cyprus (unless the property sold was built some years ago and is a single project, which means that the title deed is available when the contract is signed).
If the vendor is delaying or refusing to grant the deeds then the buyer can file an action against him and ask the Court inter alia for an injunction for specific performance otherwise the only remedy available to the buyer would be an action for damages.
Payments to the vendor
After the contract is signed your lawyer will arrange to open the necessary account(s) in your name(s) with a local Bank which are going to be used by you in order to transfer your money from abroad and make the necessary payments to the vendor.
Permission from the Council of Ministers
Before transfer of the property sold in the name of the purchaser permission must be sought
from the Council of Ministers (District Office) by written application which must be submitted by the purchaser after the agreement is signed.
This permission is granted more or less as a matter of course to all bona fide purchasers. This procedure may take 8 10 months but in the meantime; purchasers can take possession of the property without any restriction.
Transfer of Ownership at the Land Registry Office
The transaction is concluded with the transfer of ownership by a simple process of registration at the Land Registry Office once the necessary permission from the Council of Ministers is granted (as prescribed above) and a separate title deed for the property sold is issued by the Land Registry Office reflecting the property erected on the land
At this stage the buyer is responsible for the transfer fees. The rates are on a graduated scale towards the price of the property i.e. up to €85.430,07 3% from €85.430,07 170.860,14 the rate is 5% and from over €170.860,14 the is 8%.
For example if the purchase price is €150.000:
The first €85.430,07 x 3% = €2.562,90
Next €64.569,93 x 5% = €3.228,50
If the purchase is made in joint names then the total amount is divided by two and the Purchasers have a fee reduction advantages.
For example if the purchase price is €150.000 each person will pay transfer fees on €75.000.
The first person will pay €75.000 x 3% = €2.250
The second person will pay €75.000 x 3% = €2.250
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