Cyprus property market under pressure

[Nicholas Wallwork]

While many people believe that there is good long-term value in the Cyprus property market there seems to be a lack of interest in real estate at this moment in time. Official statistics show that the number of sales in January 2014 fell by 22% compared to January 2013. The Department of Lands and Surveys [...]

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[Veronica]

The property market in Cyprus has certainly been very difficult these past 2 years with last year being far worse than the previous year.
However, prices are now at rock bottom and provided buyers do their homework there are bargains to be had which have the potential for long term growth as the country recovers from the problems of the past.
The hydrocarbons will certainly help the economy once the oil workers move into the country and this should have a knock on effect on the property market.

 

[totallyproperty]

What areas of the Cyprus real estate market offer the best long term prospects?

 

[Veronica]

Resale villas with title deeds are the only way to go these days. Apartments are not wanted and there are so many almost empty complexes which are falling into a state of disrepair I would not recommend them for investment.
A good quality resale villa with a sea view if bought now while prices are at rock bottom has the best chance of bringing a profit once the economy picks up.

 

[totallyproperty]

I think the Cyprus real estate market could be one of those investments we look back on in years to come and kick ourselves for missing the "obvious" opportunities. However, sometimes it is difficult to break away from the doom and gloom surrounding the European Union and the ongoing issues with the euro.

 

[dubaiguyver]

Cyprus properties prices are so crazy cheap, but i love dubai and mallorca.

Cyprus is good for low tax in europe and cheap living, but i´m missing vegan meals.

 

[totallyproperty]

I have a feeling that countries such as Cyprus will continue to offer attractive tax rates for investors for many years to come.

 

[Veronica]

I have a feeling that countries such as Cyprus will continue to offer attractive tax rates for investors for many years to come.

Yes the tax rates make Cyprus a very attractive prospect for pensioners as the allowance means that a couple can have 39K income before paying any tax at all.

In Cyprus you can choose one of two taxation methods. You can choose to go with the personal allowance of 19.500euros before tax or you can choose to pay 5% on all of your income if you have large pensions and income from investments etc.

Therefore most British retirees who have only their UK government pension will pay no tax at all if they choose the personal allowance. Those who have extra income from personal pensions, investments etc. can decide which method to choose depending on which works out most beneficial for them. Below is a table of taxation rates.

– up to EUR19,500 nil

– from EUR19,501-28,000 20%

– from EUR28,001-36,300 25%

– above EUR36,300 30%

Remember that these figures are per person, so for couples the allowance is double.

 

[totallyproperty]

It does make you wonder why the UK property market is so strong when the tax incentives compared to other markets are negligible.

 

[Cyprus Property Buyer]

The property market in Cyprus has certainly been very difficult these past 2 years with last year being far worse than the previous year.
However, prices are now at rock bottom and provided buyers do their homework there are bargains to be had which have the potential for long term growth as the country recovers from the problems of the past.
The hydrocarbons will certainly help the economy once the oil workers move into the country and this should have a knock on effect on the property market.

It appears property prices were not at rock bottom as they have fallen further over the last 18 months.

Hydrocarbons don't look too promising either with the price of gas suggesting it isn't currently economical to extract the gas.

Some Economists are suggesting a second bailout / bailin might be needed to cover the huge level of NPL's. Property repossessions should start in earnest within the next 6 months and this should push prices lower. I would recommend that investors hold fire for a couple of years.