The Time To Invest In The Cypriot Property Market Is Here
News Posted On: 15 January 2014
Cyprus has been facing a lot of difficulty when it comes to the country’s property market. The factors have resulted in a depressed economy, problems with ownership deeds, property construction companies and their alleged outstanding taxes, allegations of corruption and fraud among other issues as locals nurse heavy financial losses.
Meanwhile, overseas investors who were previously keen on buying a property in Cyprus had lost their confidence in the Mediterranean island’s real estate market and begun looking elsewhere for a place in the sun.
The government of Cyprus had given investors a deadline to lodge legal claims against alleged real estate mis-selling within the country. Several property developers and lenders in Cyprus were under the cosh as investors from different part of the world declared that they did not receive what they had expected.
A good number of these investors were from the UK, and news of the country’s unethical real estate activities cost Cyprus heavily, with British investors moving away from its property market.
Why isn’t Cyprus' property market attracting investors?
A close look at sales transactions reveals that local sales were at their peak in 2002, when around 15,000 residential properties were sold to Cypriot nationals. Overseas sales hit their peak in 2006 when the nation recorded around 11,000 annual sales. 2006 was also a great year for the entire real estate market in Cyprus as more than 21,000 transactions were completed within those twelve months.
However, the total number of transactions in 2013 was a little under 4000. Sales to overseas investors fell to a little more than 1000, while domestic transactions totalled to 2750, signifying a massive drop.
The future of the property market in Cyprus
At the moment, Cyprus appears to have a rather bleak future. The economy is under huge pressure and the property market is struggling. Overseas investors are few and far between to add to the country’s woes.
However, market insiders insist that there are signs that indicate a recovery for the troubled economy. Tourist revenues have been on the rise since the beginning of 2013. In comparison with 2012, 2013 experienced a 20 per cent increase in the number of tourists visiting Cyprus. Tourism, in turn, has helped the Cypriot real estate market.
Many tourists who holiday on the island for the first time are often taken aback by the natural beauty and the lifestyle in the little Mediterranean nation. As a result, they come back and search for properties in Cyprus with the hopes of acquiring second homes.
Property development agencies in the country have turned their attention to Asian investors, with the Chinese and Russians atop their lists. Few companies market their assets in the UK unlike previous times.
The government has devised residency schemes which attract non-EU investors to purchase properties in the country with a view to attaining an EU passport. The program is paying dividends slowly and steadily, but complete recovery for the real estate market may take a few more years, say experts.
Written by Les Calvert
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