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| Cyprus Buying Guide Newsletter |
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How’s life? I’m feeling okay today – a bit worn out, but the weekend is almost here so I can relax a bit! I was just told that it's suppose to rain an entire months worth of rain today - sitting here in London, it's coming down in a HUGE way. I'm sure there's going to be some major flooding around here - Yikes. Any hoooooo, last week I was in Cyprus to give a work-mate and some CBG readers a whistle-stop tour of the entire island. We landed in Larnaca, went to Famagusta and then visited Limassol, Paphos, Latchi and Polis in 6 days. I’ve never done that before! As with every trip
to Cyprus, I had an absolutely fantastic time! I went to a lovely restaurant in Ayia Napa (Sage), enjoyed the night and early morning air at an open-air club called Breeze (Limassol, took a tour of Lazarus Church (Larnaca), had Kleftico at a traditional Cypriot restaurant (Paphos), toured a 5 million pound property on the hills (Limassol), picked fresh oranges from an orchard (Polis) and washed our faces in the baths of Aphrodite (Just past Latchi)
AND, I met with many property professionals, friends and people viewing properties with the intention to purchase. It was an insane visit…hehehehe – all my visits are super eventful. When I return to the UK I usually have to sleep for a day or two. Any way, I’ve got some good information for you in this newsletter. I interviewed an incredible guy, named Kyriacos, about buying property in the Famagusta region. Met with Alexandra from a law firm who provided me with some more legal information - this time about buying off-plan....and if you want a ride on a Harley, I have the perfect opportunity for you! Furthermore, I’ve included Charles Purdy’s update on the Cypriot Pound…and Olga has offered a great review on one of the hotels we stayed at during our visit. So.. that's it for my introduction. As I mentioned, I'm a bit tired. Over the past weekend, I went sailing from Portsmouth to a town called Brixham (or something like that). On Friday I was fine, but Saturday we left our mooring around noon and sailed until 9am the next day. Two hours after leaving port, I became very ill - the waves near the 'needles' at the Isle of White were HUGE... Anyway, I had to lay down the entire time and I was sick over and over. I think that I need to stick to the Med... The English waters are a bit too rough for me! Have a very good weekend... Big smiles, |
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What Makes Famagusta Special - Interview between Me and KyriacosKim: Today I’ve had the excellent opportunity to interview Kyriacos Petrou – a Estate Agent based in Cyprus. Kyriacos has been a property professional for over 10 years. I met him last year in Famagusta while doing my ‘rounds’ to promote Smart Currency Exchange Ltd. Kyriacos is a very serious, passionate and knowledgeable person – and he does what he says he’s going to do when he says he’s going to do it. I have a lot of respect for Kyriacos and I really appreciate the fact that he’s given up his valuable time to provide me (and you) with some solid information. Well…without further ado, let me get started. Welcome to my interview Kyriacos. Kyriacos: Thank you Kim. It’s my pleasure. Kim: I’m going to just dive into the questions that the Cyprus Buying Guide readers ask me most often. I know you’re based in Famagusta, but before we cover this particular part of the island – can you tell me why you think Cyprus is a great place to buy property? Kyriacos: There are several reasons, Kim. To start, Cyprus has seen an average rise in property of up to 17%/annum in the last 5 years. With almost 320 days of sunshine, it makes it an excellent choice for holidays. Crime is almost non existent along with unemployment. Not to mention the low taxes and low running expenses, making it not only for the holiday maker, but for investors and for anybody who is looking for a better quality of life. 90% of the people you meet on the island speak English, and Cyprus’ legal system is based on the British legal system. And last, but not least, we drive on the same side of the road as the UK (wink)! Kim: And can you tell me what makes Famagusta unique? In other words, why should someone considering buying in Protaras, Ayia Napa, Kapparis rather than any other place in Cyprus? Kyriacos: Well, Kim - that's a good question. The reason that many of our buyers decide to purchase in the Famagusta area comes down to these main points:
Okay...moving on...A question I get asked often is the situation with the 'Green Line' or the boarder between The Republic of Cyprus and The Turkish Occupied Territory. Most people are educated as to the risk of buying in the North and wouldn't even consider it HOWEVER for those that may consider Famagusta - is there any cause for concern about being so close to the border? Kyriacos: Cyprus has been at a cease fire since 1974 after the Turkish invasion. The UN set up base and lookout points throughout the Buffer Zone to ensure the peace is kept. Now that Cyprus has joined the EU and Turkey is in negotiations to also become an EU member, there is no reason for concern as Cyprus, Turkey, and the Occupied North Turkish Cypriots want to resolve this matter in the most diplomatic way to ensure all parties involved come to an agreement which benefit all. Kim: Thanks for that. Kyriacos - If someone was potentially interested in Famagusta however they've only ever seen Paphos OR perhaps they've never been to Cyprus before, what would you suggest is the best way for them to research the area and the properties available? Kyriacos: There is no better way, in my personal opinion, to know a country better than making your way there. Different people have different experiences and different interests. You can read up on any country on the internet and through books, ask different people who have been to the country in question and listen to their feedback. However, when you experience a place for yourself, you can form an opinion of your own. Kim: I couldn't agree with you more. You can look at pictures and brochures, but the key aspect is actually seeing the property and getting a feel for the area. Thanks to inspection trips, anyone can go for a 3-day trip and get a taste for the properties. Moving on, I know I have this is in my Cyprus Buying Guide AND on the website, but from an Agents perspective, how do agents work in Cyprus? In other words, what do agents do for the buyer? Kyriacos: Agents job is to ensure that their client(s) are well informed! To make them aware of all the pros and cons of buying the property of their choice in Cyprus and to be there from the beginning of their search for a property right up until the client has completed their property purchase, and I some cases, well after the purchase has been completed. Every step taken is to ensure that the client walks away well informed, with full confidence in their choice. The best way to ensure that you receive the best possible service from your agent is to be honest. Let the agent know exactly what you want from your property purchase and allow him/her to ensure your needs are met.
Kyriacos: In every country you go to, there are good agents and bad agents. Again I will stress the important of research. Ask many questions and have the agent answer them. If the agent is unsure, their job is to look for the answers ASAP or put you in contact with people that do know the answers. Stay away from agents that don’t go that extra mile to get you any information you have requested about your property purchase. Agents are there to listen to YOUR needs, not the other way around, so if you feel your agent is not listening to what you want, then take a step back and reassess the situation. In some cases, you may need to choose another agent. Be honest and tell the agent you are not happy with them. If nothing is done to rectify the situation, report it to their superiors. That is a very good way of making sure that it doesn’t happen again. Kim: What tips would you give to the Cyprus Buying Guide readers for buying a property in Cyprus? Any ways to save money or avoid bad developers/agents? Kyriacos: My first piece of advice would be to decide what it is you are buying for. Is it for investment, a holiday home, or residence? Have a clear vision of what it is you want to achieve. I would then suggest determining your budget, not only the cost of the house, but your solicitors fees, stamped duty, transfer fees, etc. How will the property be financed? If with a mortgage, that’s another cost to take into consideration Financial advisors are great people to have in your corner in times like these. They can make you aware of things that can save you plenty of money in the long run. And, last, but no least, a currency strategy, which could definitely save you thousands. Kim: Just out of curiosity – why did you decide to stay in Cyprus? Many Cypriots have moved to England and various other countries. Kyriacos: Why do most people decide to stay in their country of origin? Its home, to me. Cyprus is a great country with deep morals and values. Cyprus is very family orientated, and people are there for people everyday, all day, not only when it is convenient. As you can see, family is very important to me and my family’s safety and upbringing I on the top of my priority list. Kim: That’s great Kyriacos…Well before I wrap things up, is there anything else you would like to add to help anyone thinking of buying in Cyprus? Kyriacos: I would. Buying a property is a big decision that should not be taken lightly. Do your homework before you make the decision to buy. It is a very stragith forward process once the decision to purchase is made. In fact, many people are often frightened once they see how easy it is to purchase property in Cyprus when compared to the UK. I can assure you that when you have a good team working for you (i.e. agent, solicitor, financial advisor, currency exchange advisor), your property purchase in Cyprus should be a gratifying and wonderful experience! Kim: Kyriacos – I really appreciate the time you’ve spent answering my questions. Famagusta is one of my favourite regions in Cyprus. I'm usually there once evey 6 weeks so if you'd like to view some properties with me, fill out the form and I'll see if I can help you find the property of your dreams!: http://www.cyprusbuyingguide.com/requirementsform.htm Furthermore...If you'd like to chat with Kyriacos yourself, just let me know - He's a GREAT guy and would be more than happy to help you find a property. Just eMail me at: |
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Cypriot Pound Updateby Smart Currency’s Charles Purdy.The Bank of England Limited voted by 6 to 3 to increase UK interest rates at the their last meeting. There is still inflationary pressure in the UK system, which is being exasperated by increasing oil prices, and which will be difficult to curtail without even higher UK interest rates. Another increase in UK interest rates is expected by the end of the year. The Cypriot £ has pushed up to CY£0.865/£1 inter bank. The Cypriot £ is pegged to the Euro and as such moves in line with the Euro vs. sterling. The Euro has been supported by upward revisions to first quarter gross domestic product growth and healthy industrial production in Euro land. The European Central Bank is expected to increase interest rates in September to keep on top of inflation. To get a Better-than-Bank
rate go to: http://www.smartCurrencyExchange.com/smartsquotation.htm
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Legal Corner: Buying Off Plan Property, by Louise ZambartasPeople buy property in Cyprus for different reasons. Some people buy to retire in Cyprus, some are looking for a holiday home and others wish to invest in Cyprus. If you are planning to buy a property in Cyprus then the chances are you’ll be offered the chance to buy off plan, but what are the implications of doing so? The Overseas Guides Company has teamed up with The Law Offices of Louise Zambartas to provide you with some answers. Over the next few editions we will be asking Louise Zambartas to shed some light on Cyprus Property Law. Louise is one of the few dual qualified English Solicitor/Cyprus Lawyers on the island, she lives and works in Limassol, Cyprus. In this second article Louise will carefully examine buying off plan in Cyprus. In next issue’s article she will be examining specific issues raised when buying land and in following articles she will examine the cost and tax implications of buying in Cyprus. Planning permission and building licenses As in many developing countries, in Cyprus it is not always the case that the developer will have obtained full planning permission (the first stage of permission) and a building license (a more detailed permission relating to the method of construction) at the time that the property being sold off plan is purchased. It can take months (if not years!) for the permits to be granted and most developers will start to sell a project without actual permits being in place. Developers may start work after obtaining planning permission but may not necessarily always wait until the full building license is in place. Contractual protection and escrow accounts
Developers are also willing to take the buyers risk away by agreeing for monies to be held in an escrow account (in other words a holding account), until the planning permission is granted and work can begin. Architects certificates and stage payments With off plan purchases the usual arrangement is for the developer to be paid in stages. Each time a major stage in construction is reached, funds are released to the developer for work that has already been completed, estimated dates for completion of the stages should be included in the contract of sale. This should be verified by an Architect’s Certificate, confirming the work has been done. The involvement of the financing bank In cases where the stage payments are being paid by a Cyprus bank, the Bank provides in-built safeguards and takes responsibility for ensuring that any funds released to the developer are for work that has been done and approved by an Architect/Civil Engineer - appointed by the bank and not connected with the developer. They do this to protect their investment as much as the purchasers! In addition, the involvement of a mortgaging bank provides a further layer of protection against the developer’s bankruptcy. The sale price is typically made up as follows, based on approximate figures estimated by the Chartered Surveyor: 35% - the value of the land Mortgages are usually for 80% maximum of the total cost of the property, with a 20% minimum contribution coming from the purchaser as dictated by the Central Bank in Cyprus. This provides security for the purchaser, in that they are paying less than the cost of the land in the first instance and building progress has to be made before money can be claimed by the developer. The payment has to be approved by the Architect/Civil Engineer before transfer is made. If the developer goes bankrupt, the 80% mortgage granted to the purchaser covers the whole of the cost of building the property. So no matter at what stage the developer disappears from the scene, there is sufficient money in the mortgage to finish the property and deliver it to the purchaser, provided that the initial 20% has been paid. Completion, delivery and snagging Mortgage products are available in Cyprus now whereby no repayments have to be made until the property is completed and confirmed as such. The advantage of this is that the property can start earning money for the purchasers before they have to pay anything back to the bank. The basis of such arrangements is that the developer will take the stage payments he needs to complete the work but repayments of both capital and interest are deferred until completion of the property. Some buyers will chose to be present for delivery of their property. If that is not possible, an independent surveyor appointed by the buyers can confirm completion and identify any snagging (minor defects) that need to be remedied. A good Contract of Sale will allow for the retention of money until all snagging is remedied and the property is completely finished. Financial penalties for delay and contractual hold backs. It is important to impose penalties in the event that properties are not completed by the agreed date. If this is at the start of the summer period, but delivery is delayed until December, the buyer will have lost valuable income from the High Season. Holding money back, even a relatively small sum, is important to make sure minor defects are remedied, as we have mentioned. If you would like
to speak with Louise regarding property law in Cyprus, just drop me
an email at Kim@CyprusBuyingGuide.com
and I will gladly arrange for Louise or a member of her team to contact
you directly. |
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Hotel Review - By Olga (my co-worker and companion on my last trip to Cyprus)
The Coral Beach Hotel and Resort is situated on a sandy beach of the Coral Bay in Paphos. It has a majestic entrance with a circled driveway, richly decorated with colourful flowers and palm trees. As Kim and I arrived with our heavy suitcases, the doorman quickly rushed to our rescue and helped us into the air-conditioned entrance hall. We checked in and were taken directly to our room. It took a while to get there: the Coral Beach Hotel is huge… but it’s well worth the walk. Our room was decorated in cool shades of blue and yellow and a complimentary bottle of wine and basket of fruit awaited us. The French door in our room led directly to the outdoor pool – who could resist such an invitation? The pool is surrounded by welcoming sunbeds, palm trees and flowers. Perhaps the only tiny problem is that, after the hot day, the pool was fairly warm…but a solution was close at hand! As its name suggests, the Coral Beach Hotel is situated right on the beach: you need only walk a few metres before plunging into the sea. . ...read more
For more information visit: www.coral.com.cy Postal Address: P.O.Box 62874, CY-8099 Paphos
Cyprus Email info@coral.com.cy | |||
Would you like a ride on a Harley Davidson?I'm not sure how long you've been reading my Cyprus Buying Guide newsletters, but last year I wrote an article about taking a Harley tour from Paralimni to Larnaca to Nicosia and back to Paralimni. It was the most incredible experience... Any way, the guy that took me on the tour (Lionel) is one of my bestest friends ever...and he's now offering rides to anyone in the Famagusta area. Lionel is such a great guy...and if you've never experienced a ride on the back of a Harley, I strongly urge that you give it a go. Holy smokes - it really is amazing... Lionel sent me his
brochure, so check it out here: Lionel's
Brochure |
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| Cyprus Buying Guide & Online Community Have you purchased the Cyprus Buying Guide yet? If you're serious about buying in Cyprus the Cyprus Buying Guide is an absolute MUST. This is what readers have told me about the guide:
http://www.CyprusBuyingGuide.com/guide.htm
AND...PLEASE go to the Cyprus Buying Guide Forum to share your stories, thoughts and communicate with others that are doing the same thing as you...
Kim
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Kim:
I have to admit, Famagusta is my favourite area. I've spent months in
Paphos, Larnaca - a week in Polis/Latchi, a bit of time in the Trodos
and even a month in Limassol however I always make sure the majority
of my time is spend in Famagusta... Even in the winter! I really do
feel that it's great value for money.
Kim:
What I really dislike about Cyprus is the terrible stories I hear from
people buying from bad agents, marketing companies and bad developers.
Since you've been in the industry for 10 years, I'm sure you've seen
many dodgy things. Can you give any tips on how someone can look out
for bad agents? What do they do that they shouldn't do? Or how can a
buyer see warning signs that things are not right?
This
begs the question, is it safe to enter into a contract to purchase a
property off plan, if the developer has not been granted planning permission?
Provided the contract deals properly with the position and the refund
of money if the permit is not obtained, then it should be safe to proceed.
Reputable developers will be experienced with local planning rules,
regulations and restrictions and will have applied for permission they
are likely to be granted. Plans will have been drawn up within local
guidelines, e.g not above a certain number of storeys or covering more
of the land than is permitted for the area.
