Is the Cyprus property market bottoming out?

[Nicholas Wallwork]

The Cyprus property market suffers from two major issues in that it is relatively small compared to the worldwide market and is often associated with Greece, an area of the world in major financial trouble. As a consequence there are some very mixed views on the Cyprus real estate market with prices continuing to fall [...]

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[Veronica]

Prices are stabilising with many resale properties already having been reduced by as much as 30%.
The few owners who were being stubborn and holding on to the higher prices are at last realising that they have to be realistic if they want to sell and therefore we are still seeing a drop in some prices but only those who were still holding out despite the crisis in the market.
The past two years have seen a huge drop in sales from the previous years but this year is showing signs of improvement with more enquiries coming in. I doubt whether it will ever get back to the level of the boom times a few years ago but that will maybe be a good thing as the industry was totally out of control.

 

[Cyprus Property Buyer]

Prices are stabilising with many resale properties already having been reduced by as much as 30%.
The few owners who were being stubborn and holding on to the higher prices are at last realising that they have to be realistic if they want to sell and therefore we are still seeing a drop in some prices but only those who were still holding out despite the crisis in the market.
The past two years have seen a huge drop in sales from the previous years but this year is showing signs of improvement with more enquiries coming in. I doubt whether it will ever get back to the level of the boom times a few years ago but that will maybe be a good thing as the industry was totally out of control.

I am sure you are right that it will never get back to the uncontrollable levels it operated at a few years ago. In my opinion there should be NO further building permits issued until there is a workable system of issuing title deeds i.e. they are issued as soon as the property is completed. Until this happens Cyprus will always be a country well avoided for the wary property buyer.

There are many thousands of properties sat empty on the island so there is no requirement to build additional units for many years to come.

 

[Barny]

I know the original post was from earlier this year but having just visited Cyprus again (my in-laws live near Kyrenia, Northern Cyprus) I have a little input into this.

As per the original link, a lot of people associate the term 'Cyprus' with Greece and many don't actually know it's split between Turkey and Greece.

As mentioned, due to the in-laws, we visit for about 4 weeks every year, at different times, and have done so for about 5/6 years now but on our latest visit from which we returned at the weekend, we were actually looking at properties in and around the Kyrenia and Lapta areas as an area to invest in and must admit, it is a very appealing market.

As an example, we viewed 3 properties, 2 of which are in an area where we know people who rent them out for both a holiday let (weekly rent between May to Sept) or as a residential let (Oct to April) and the potential and 1 is a new development near where we visit the in-laws every year so know the area well.

These properties have the following figures:

Property 1 - £29,000 - No pool - Holiday Let £300-£500 per week - Residential Let £250-£350 per month
Property 2 - £32,000 - Private pool - Holiday Let £350-£600 per week - Residential Let £300-£400 per month
Property 3 - £38,000 - Communal pool - Holiday Let £400-£750 per week - Residential Let £325-£450 per month

Obviously, when compared to the UK market (where I'm from) the prices are amazingly low and the potential income, even if only rented out for 50% for both the holiday (10wks) and residential (3mths) let periods at the minimum figures shown, the annual income would be approximately:

Property 1 - Holiday Let £3000 - Residential Let £750
Property 2 - Holiday Let £3500 - Residential Let £900
Property 3 - Holiday Let £4000 - Residential Let £975


Therefore even these figures are quite a respectable income on a property that in theory, before additional costs, would pay for itself in 10 years and although the residential figure is low compared to that of the holiday let, atleast the property would not sit empty. Add into the equation more than the above 50% and that is an even better position.

So to summarise, yes, as a whole, there may be a belief that the Cyprus property market is bottoming out but in reality, there are certain people who are still seriously interested in it and looking to move into this market.

 

[Cyprus Property Buyer]

I know the original post was from earlier this year but having just visited Cyprus again (my in-laws live near Kyrenia, Northern Cyprus) I have a little input into this.

As per the original link, a lot of people associate the term 'Cyprus' with Greece and many don't actually know it's split between Turkey and Greece.

As mentioned, due to the in-laws, we visit for about 4 weeks every year, at different times, and have done so for about 5/6 years now but on our latest visit from which we returned at the weekend, we were actually looking at properties in and around the Kyrenia and Lapta areas as an area to invest in and must admit, it is a very appealing market.

As an example, we viewed 3 properties, 2 of which are in an area where we know people who rent them out for both a holiday let (weekly rent between May to Sept) or as a residential let (Oct to April) and the potential and 1 is a new development near where we visit the in-laws every year so know the area well.

These properties have the following figures:

Property 1 - £29,000 - No pool - Holiday Let £300-£500 per week - Residential Let £250-£350 per month
Property 2 - £32,000 - Private pool - Holiday Let £350-£600 per week - Residential Let £300-£400 per month
Property 3 - £38,000 - Communal pool - Holiday Let £400-£750 per week - Residential Let £325-£450 per month

Obviously, when compared to the UK market (where I'm from) the prices are amazingly low and the potential income, even if only rented out for 50% for both the holiday (10wks) and residential (3mths) let periods at the minimum figures shown, the annual income would be approximately:

Property 1 - Holiday Let £3000 - Residential Let £750
Property 2 - Holiday Let £3500 - Residential Let £900
Property 3 - Holiday Let £4000 - Residential Let £975


Therefore even these figures are quite a respectable income on a property that in theory, before additional costs, would pay for itself in 10 years and although the residential figure is low compared to that of the holiday let, atleast the property would not sit empty. Add into the equation more than the above 50% and that is an even better position.

So to summarise, yes, as a whole, there may be a belief that the Cyprus property market is bottoming out but in reality, there are certain people who are still seriously interested in it and looking to move into this market.

But what is the legal status of the properties as they are located in the occupied north of the island which is only recognised by Turkey?

 

[Veronica]

But what is the legal status of the properties as they are located in the occupied north of the island which is only recognised by Turkey?

Many of the properties in the North have a very iffy legal status as they are built on land owned by displaced Greel Cypriots. Even with title deeds which have been issued by the occupying Turkish governement they still legally belong to Greek Cypriots.
We were recently up in the North for a few days and the general air of dilapidation and the lack of good infrastructure was very obvious.
I do like the North very much but would never want to live there and I certainly would not risk buying a property without checking out the title deeds with the Government land registry in Nicosia.

 

[Cyprus Property Buyer]

I agree Veronica the north of the island is very beautiful and I also find the business owners to be generally more appreciative of your custom than many in the South.

Prices in the north are considerably cheaper than in the South and this is one reason the island has been divided for over 41 years.

I would be interested to know from Barny what type of properties each of the 3 are (number of bedrooms, apartments or houses etc).

 

[Veronica]

Prices in the north are considerably cheaper than in the South and this is one reason the island has been divided for over 41 years.


The main reason that prices in the North are lower than the South is because the properties are built on illegally stolen Greek Cypriot land. There are many foreigners who have bought these properties but face the prospect of losing their homes unless an agreement can be reached with the rightful owners of the land.
A very good reason not to even consider buying in the North until the problems of the division and who owns what are sorted out once and for all.

After the Orams case many of these half built projects ground to a halt which is why there are so many ghost towns in the North. Quite upsetting to see actually.

 

[Cyprus Property Buyer]

The main reason that prices in the North are lower than the South is because the properties are built on illegally stolen Greek Cypriot land. There are many foreigners who have bought these properties but face the prospect of losing their homes unless an agreement can be reached with the rightful owners of the land.
A very good reason not to even consider buying in the North until the problems of the division and who owns what are sorted out once and for all.

After the Orams case many of these half built projects ground to a halt which is why there are so many ghost towns in the North. Quite upsetting to see actually.

That is correct, but many things in the north are cheaper than the South, not just property, and this is holding back the reunification of the island i.e. either the cost of living falls in the South to match the north or vice versa.

 

[Cyprus Property Buyer]

I know the original post was from earlier this year but having just visited Cyprus again (my in-laws live near Kyrenia, Northern Cyprus) I have a little input into this.

As per the original link, a lot of people associate the term 'Cyprus' with Greece and many don't actually know it's split between Turkey and Greece.

As mentioned, due to the in-laws, we visit for about 4 weeks every year, at different times, and have done so for about 5/6 years now but on our latest visit from which we returned at the weekend, we were actually looking at properties in and around the Kyrenia and Lapta areas as an area to invest in and must admit, it is a very appealing market.

As an example, we viewed 3 properties, 2 of which are in an area where we know people who rent them out for both a holiday let (weekly rent between May to Sept) or as a residential let (Oct to April) and the potential and 1 is a new development near where we visit the in-laws every year so know the area well.

These properties have the following figures:

Property 1 - £29,000 - No pool - Holiday Let £300-£500 per week - Residential Let £250-£350 per month
Property 2 - £32,000 - Private pool - Holiday Let £350-£600 per week - Residential Let £300-£400 per month
Property 3 - £38,000 - Communal pool - Holiday Let £400-£750 per week - Residential Let £325-£450 per month

Obviously, when compared to the UK market (where I'm from) the prices are amazingly low and the potential income, even if only rented out for 50% for both the holiday (10wks) and residential (3mths) let periods at the minimum figures shown, the annual income would be approximately:

Property 1 - Holiday Let £3000 - Residential Let £750
Property 2 - Holiday Let £3500 - Residential Let £900
Property 3 - Holiday Let £4000 - Residential Let £975


Therefore even these figures are quite a respectable income on a property that in theory, before additional costs, would pay for itself in 10 years and although the residential figure is low compared to that of the holiday let, atleast the property would not sit empty. Add into the equation more than the above 50% and that is an even better position.

So to summarise, yes, as a whole, there may be a belief that the Cyprus property market is bottoming out but in reality, there are certain people who are still seriously interested in it and looking to move into this market.

Barny are you able to provide more details on the properties you refer to? I don't want addresses or anything like that, just number of bedrooms and type of property. Thanks