Hello – how are you this month?

Well, in Cyprus, there were really freak weather conditions - unheard of for September .On Friday the 18th a tornado hit Cyprus, badly affecting Nicosia and Larnaca districts. 17 people were badly injured, mostly injuries from flying glass. Similar conditions continued over the weekend, with power lines were ripped down and numerous roads closed. Parts of Nicosia were ripped to pieces. The extreme weather continued over the weekend and emergency services worked round the clock. Luckily, all is okay now and back to normal, nice and calm again with sunny warm days.

It seems that Cyprus, small island though it may be, is really going from strength to strength.

According to a recent survey by themovechannel.com, Cyprus is an even more popular place than before to invest in property. Their “Top of the Props” chart shows Cyprus moving up three places from 10th to 7th.  Another survey published by homesoverseas.co.uk shows Cyprus moving up one place to number 8. So if you are thinking of buying in Cyprus – don’t delay – you could see the bargains that are around at the moment vanishing rapidly as the destination grows in popularity!

Then more news that may affect you: if you hold an account with The Bank of Cyprus in the UK, they have decided they can’t compete any longer with the major banking giants and have decided to enter into an agreement with Lloyds TSB.

Kim

Cyprus Buying Guide
The Overseas Guides Company
Kim@CyprusBuyingGuide.com

Buyer Beware!

Just today one of my colleagues drew my attention to an article in The Sunday Times of Cyprus. I won’t bore you with all the details but what happened was that a British man is being sued by a local estate agency for commission on his property in Cyprus even though he ultimately sold his house through his own efforts.

Long story short…the owner had originally decided to sell his property via an estate agent. After a number of months the property had not sold, even although the price had been dropped a number of times, so he decided to market the place himself.  In the interim the estate agent had asked for a copy of his passport via fax or email and sent an email that said that they were attaching a new Agreement so that they could start marketing his property at the new, lower price.

It was only later that the seller realised that the new agreement stipulated several new conditions regarding the agent’s fee, and he maintains that the purpose of the new agreement was misrepresented to him: “They tricked me into signing a new agreement with the wording: ‘Please sign and return the original via post so that we can start marketing your property at the new listing price” he said.

Although he freely admits that it was ill-advised to sign a legal document without reading it carefully or having it checked by a reliable lawyer, he maintains that he had not been given any reason to believe that the basis of his original contractual relationship with the agent had changed so fundamentally – they certainly had not pointed it out.

One clause of the new agreement, for instance, said that “if the property is sold to any person during the currency of this agreement the seller acknowledges that the sale of the property was achieved as a result of the actions of the estate agent company.”

After extensive personal marketing of the property by the owner it finally did sell, but entirely through his own efforts.  Imagine his consternation when he discovered that the estate agent had somehow heard of the sale and proceeded to block his Cypriot bank to the tune of some €15,000 and he was being sued by them for non-payment of the agency fee! He is contesting this in court.  A local lawyer commented that “I believe some of these clauses are excessive; for example clause 11, under which the agent expects a fee even if the property is sold 12 months after the agency agreement has been terminated or has expired” – I mean, can you believe that? You can just imagine the stress this is causing, not to say cost if the chap loses the court case…

So the value of good and trustworthy people is key.  Plus a well thought out strategy with checks on a regular basis and advice from people who know exactly what they are doing.  This may include lawyers, Independent Financial Advisors (IFAs), insurers and estate agents.  I am just a phone call away on 0207 898 0549 if you need recommendations and if I can’t help you, I will know someone who can.

There’s something about sterling…

by Smart Currency’s Charles Purdy.

So what is the problem with sterling? Since the start of August we have had significant sterling depreciation against most currencies. Clearly we have had major problems following the collapse of Northern Rock, the Royal Bank of Scotland and HBOS [Halifax Bank of Scotland]. But so have the US and the Eurozone had problems with their financial system and, like us, continue to do so.

Therefore why is sterling the pariah? The problems for sterling are numerous. The UK economy was very dependent on the finance sector which suffered most in the credit crunch. We also suffer from a balance of payments deficit which means that flows of funds out of the country exceeds inward flows - never good long term. The US$ and the € have the benefit of  the former being viewed as the world’s reserve currency and a safe haven asset.  The latter is a very major world currency used as a common currency by a large number of countries, one of which is the world’s greatest exporter, namely Germany. We also have a Central Bank who seems to lack the fire power or the efficiency of the European Central Bank who seem to be able to make large funds available to its banks at a moments notice.

But the major problem is the Government’s budget deficit - which existed prior to the credit crunch - and it’s huge explosion resulting in record Government borrowing.  Also there is no political will or cogent plan to cut it prior to the next general election. Until we see this plan and people believe in it sterling will have no “fans” internationally. And until we see investors start to view sterling positively again it is very unlikely we will see a significant appreciation in sterling, certainly not against the euro.

In fact some commentators see us returning to parity with the £1=€1 by the end of the year. If this does happen, your €’s would cost you 10% more than they would at the moment. Do you want this to happen?

If not, you need to contact Smart Currency immediately – call on 0207 898 0549 or freephone 08081 630 102and have a chat about ways you can avoid this. 

To read the latest on Sterling and the Euro go to: http://www.CyprusBuyingGuide.com/Currency240909.htm

View up-to-date currency reports Rate movement alerts and much more... Go to: http://twitter.com/SmartCurrency

Why overseas property buyers lose money...
...and how you can avoid it!

This 10-page educational report outlines:

• Case Study: When Property Buyer, Mr Reed, Purchased an Overseas Property, he Made Three Mistakes that Cost Him £10,256...learn how you can avoid them...
  
  
• How the Banks make HUGE profits from their long-standing unsuspecting customers
  
  
• Ways to safeguard yourself against adverse fluctuations in exchange rates (or in other words, helping you to keep your money in your pocket)
  
  
• The entire process of moving money from the UK to any overseas location, so that you're armed with all the knowledge you need to make intelligent decisions about your money
  
  
• How you can ultimately save £100’s and £1000’s so that you have ample money to buy furniture and white goods…
  
  
• More case studies of people that lost money due to foreign currency strengthening against the pound, so that you learn from other peoples mistakes rather than your own!
  

And just a couple remarks about the report from our readers...

"We have found your free report to be extremely helpful... Wendy Watson"

"I have read and absorbed the information in the stories outlining the mistakes which the uninitiated can make when transferring currency. It is very illuminating and essential that any one,like myself, who is in the process of buying an overseas property should be aware of. I would go so far as to say that every agent selling overseas properties should be compelled to advise their prospective purchasers that it is paramount that they use a currency expert such as yourselves. Regards, Eric Thomas"

To get a copy of the report at no charge go to: http://www.smartcurrencyexchange.com/freereport.htm

To get a Better-than-Bank rate go to: http://www.smartCurrencyExchange.com/smartsquotation.htm
or call Carl on 08081 630 102 freephone.

Financial planning

Financial Planning Week, which took place from 7th to the 13th September, was an information campaign run by the Institute of Financial Planning (IFP).  The main aim of the campaign was to assist the ordinary ‘man in the street’ - the likes of you and me - to deal with the day to day financial concerns that we all experience.

What they particularly want to do is to suggest easy steps that we all can take to make our money really work for us. 

I clicked on their 10 simple tips – have a look at the link below and yes, they are simple - but they are still utterly essential in order to look after your assets.

http://www.financialplanningweek.org.uk/

In brief, they are:

1. Identify your goals
2. Know what you are worth
3. Budgeting
4. Debts
5. Stash some cash
6. Save!
7. Get yourself protected
8. Retirement plans
9. Investing – not just for the rich
10. Spread the word

These are all logical steps but often we just don’t concentrate on actually getting the answers to these all important questions, nor do we take steps to ensure our financial independence in time.  ‘Tomorrow is another day’ often seems to be the feeling, and yet these are matters that should be addressed as early as possible in order to give yourself time to plan and also for investments to mature. 

Here at the Overseas Guides Company we have a guide to moving pension overseas and I have also sourced a financial specialist who is dedicated to assisting our readers with all aspects of financial planning, in all countries. I would be very happy to put you in touch with a professional company that other guide readers have used and highly recommended.  Please call me on 0207 898 0549 if you would like to chat about this or fill in the brief form below and I will call to discuss this further

http://www.CyprusBuyingGuide.com/requirementsform.htm

Prices from € 112,000

The economy has fared okay in Cyprus during the global credit crunch - certainly much better than the UK and virtually all of the European economies.

It is official that Cyprus has not gone into recession and still has a positive Gross Domestic Product (GDP).  In fact, the IMF recently revealed that Cyprus had the highest GDP in the EU – not bad for a smallish island!

Tourism in 2008 remained the same as the previous 3 years, something that most countries relying on tourism would envy. This is especially important as tourism in Cyprus accounts for the single largest part of the country’s GDP.

The Project highlights:

• Very low entry investment, from € 5,740
• Great Location with easy access to Paralimni and local beaches
• Good rental potential due to prime location and facilities
• Large communal swimming pool
• High specification – A/C units, white goods and parking included in the purchase price
• Mortgage product - 2 yrs pay nothing & 5 yr interest only repayments
• 100% finance available (subject to contract)

The development is located on the Paralimni/Kapparis border, in a quiet residential area about 700 meters away from Paralimni and the town square with lots of restaurants, bars and shops. The area has very strong rental and growth potential over the next 5 – 7 years.

Access to the main tourist centre of Protaras, Pernera and Kapparis is extremely easy. The area has the island’s best beaches with many having achieved the EU ‘Blue Flag’ status for cleanliness and water quality. The area has huge infrastructure developments occurring with a new road network, a new enlarged airport at Larnaca (due for completion at the end of 2009), and a marina and golf courses planned.

Budget airlines have truly arrived in Cyprus with Easyjet and Monarch now flying to both international airports. This has driven down flight costs, especially in the peak season when reasonable flights costs are now available. In Paralimni the main road is being widened and upgraded to improve traffic flow. There are several small business parks now being developed with IKEA, Lidl and many other well know blue chip companies starting to open up business in the area to service the growing demand.

Specifications:

• High quality kitchen and bathroom fittings included
• A communal lift to all floors
• Aluminium double glazed windows and blinds
• Electrical sockets for telephone and TV in lounge and bedrooms with a Sat TV point in lounge
• Built-in wardrobes in all bedrooms
• Air conditioning units in all bedrooms and living rooms
• All white goods included (oven, hob, extractor, washing machine and fridge freezer)
• Solar panel heating, environmentally friendly
• Private verandas/balconies to all apartments
• Private car parking space per apartment

If you are interested in this, or indeed any other property in Cyprus, please give me a call on 0207 898 0549 or fill in the brief form at:
http://www.CyprusBuyingGuide.com/requirementsform.htm

Non-resident status continued!

I had input from one of our newsletter readers about the non-resident article that was in last month’s newsletter.  He points out that the Sunday Times article was not referring to people emigrating. I am popping in his reply for you:

It was specifically with respect to "Wealthy people planning to move abroad for part of the year to beat the 50% top rate of tax"

To put émigrés minds at rest, put simply if you move to a country that is not deemed a "Tax Haven" such as some Caribbean islands, then you are taxed on all your worldly income by that country and not by the UK. If you spend 183 days or more resident in that country in that country's tax year, then you will be taxed there and not here. If you have dividend income from UK companies then UK tax (currently at 10%) will be deducted at source but allowed against you tax in your country of residence (assuming a double taxation agreement exists). There might be slight anomalies during the first year because the UK tax year runs to 5th April each year, whereas most other countries run to the 31st December, however the double taxation agreement should cover that.

The possible difficulties arise if you do not spend 183 days or more per year in a single foreign country, For then the question will arise as to which country should tax you since you are no longer resident in a single country for the majority of the tax year. Some countries will claim the right to tax you if your main home is in their country. The UK has the notion of "Ordinary Residence", a term not defined in statute, but for at least 40 years to my knowledge the test has basically been if you spend 90 days or more per tax year in the UK or maintain a property you can use in the UK.

There should be no problems for a genuine émigré, or for those permanently living abroad if their countries have a double taxation agreement with the UK. However the efforts of all tax administrations to catch those who wish to avoid all tax is likely to mean that you have to establish residence in a country with a double taxation agreement with the UK if you wish to avoid all avoidable UK taxes. If you have no assets in the UK the UK authorities are unlikely to pursue unless you spend more than 183 days in the UK in a UK tax year. As an example if you have substantial UK pension income and you move to a tax haven (e.g. Turks and Cacaos Islands) your pension will continue to be taxed at source in the UK. If you move to a county with a double taxation agreement with the UK the UK authorities will allow the pension to be paid gross and your country of residence levy the appropriate tax.

Probably the biggest loophole plugged in recent years concerned capital gains tax. The UK can only tax you if you are resident in the UK for 183 days or more in the tax year, so people wishing to for instance sell assets (typical real estate or shares on which the was a substantial capital gain would move abroad for a year and sell the asset once abroad thereby avoiding what was then 40% capital gains tax. They would then move back to the UK the following year. The law has now changed in that HMRC can now charge you capital gains tax in respect of earlier years when you were not resident (i.e. 183 days) in the UK if you were "ordinarily resident" which whilst not precisely defined it is generally accepted that you are not "ordinarily resident" if you did not have a property in the UK which you could stay in and did not visit the UK for more than 90 days a year in all of the last 4 years, but the matter could be muddied if you are not tax resident in any other jurisdiction.

I am sure that this is massively helpful and I am always grateful for any input that you may wish to share with other readers. Please do contact me if I can put you in touch with an IFA (Independent Financial Advisor) – it’s always a good idea to know exactly what you can expect in your new country. Just phone me on 0207 898 0549.

Professional Companies to help you

I am always on the lookout to find professional people for you – people who will not only do the job, but do it in an ethical, friendly and professional manner. Here are two companies that have proved really popular with guide readers. 

As an owner - or a potential owner - of a home overseas, you will already understand the importance of protecting your valuable asset. Until now it has been hard to find an insurer that really does what you want them to, that provides comprehensive protection and the flexibility you need to cover your home abroad.  Luckily I have found someone who does all this – and more – they actually insure properties in more than 40 countries!  Whether you are actually living there or not, or even if you have let it out, their policies are designed to cover every eventuality.

If you would like more information on this please click on the link below or contact me at 0207 898 0549 and let’s have a chat. Last month alone 17 people clicked on our insurance link and purchased insurance through Intasure – not a bad recommendation in one month alone!

Intasure

Holiday lettings
holidaylettings.co.uk is the perfect site, both to find a place to stay locally while you look for your new home abroad and to advertise your property if you decide to rent it out. 

If you are renting out, a great facility is that you can check on how your advert is performing by clicking on the view enquiries section of your home management page. From here you can see the number of hits (visits to your page) you have had over the past 30 days and the number of enquiries you have had over the course of a year. It really is a well thought out and intensely helpful website that should maximise the number of people looking to rent your property.

One of my associates has managed to get very special deals for Guide Readers who are new advertisers on the holidaylettings.co.uk website.  If you enter 45749 as the promotional code, you can get 15 months of advertising (of your property) for the price of 12 months.  Or just click on the link and the code will appear automatically.

Holiday Lettings

What’s on in Cyprus

Time to get your running shoes on
Do you remember a while ago I mentioned Cyprus had the most amazing running challenge each year - and that if any of you happen to enjoy running, then you should be making your way to Cyprus in November?  Well, time flies and the experience is about to happen again!

The Cyprus International 4-day Challenge is taking place for the 5th consecutive year in Paphos from 26-29 November 2009 for runners of all levels wanting to test their strengths in this daring event!

Around 350 participants from the UK, Germany, The Netherlands, Belgium, Austria, Switzerland, Italy, Ireland, Norway, Greece, Russia, Brazil and Cyprus are contributing for 2009.

So why is it so special? 

Well, four different races take place over four days. Last year the first day started with a time trial of 6-kilometres from Coral Beach, ending at Sea Caves. The second day was an 11-kilometre hill run, starting close to sea level in the Akamas Park and ending at Arodes Village. The third day was a multi terrain half marathon starting at the Smigies picnic area after Neo Chorio ending by the main coastal trail of the Akamas. The last race of the series, the 10-kilometre Paphos City Run started and finished by Paphos Harbour. This can be run as a race on its own so that supporters of runners, as well as everyone who is interested, can take part. 

Over half of the event is taking place in the absolutely stunning Akamas Reserve.  Runners are guaranteed real challenges with adventurous on and off road running as well as hill climbing – not for the faint-hearted! 

Participants as young as 20 through to the most mature competitor, who last year was a British lady aged 73, will again be enjoying this fantastic yearly event.

Most of the runners are also holidaying on this beautiful island – where the weather this time of the year is absolutely perfect for running.

Why not visit their website for further information? An event definitely not to be missed! www.cypruschallenge.com

Open Studios
Now in its fourth year, “Open Studios” is a major cultural event in Cyprus. During October, over the weekends, the public are invited to numerous participating artists’ studios to view their work. About 30 studios will open from Paphos to Polis, Peyia to Limassol.  Painters, sculptors, photographers, ceramicists, mosaic, glass and textile artists will be available.  All artists have been reviewed by the Cyprus Chamber of Fine Art so you can be sure that what you are seeing is the best.  Most studios will be open between 10am to 1pm and 2pm to 6pm and you will be able to buy artworks directly from the artists, or talk to them about commissioning

Goodybye for now...

That's it for this month. Give me a ring on 0207 898 0549 if you want to chat. Otherwise, I'll send you more udpates next month.

Kind regards,

Kim
Cyprus Buying Guide
The Overseas Guides Company Limited.
mailto:Kim@CyprusBuyingGuide.com