A QUICK GUIDE TO INVESTMENT IN CYPRUS

Facts about Cyprus

Cyprus is an island situated in the northeast corner of the Mediterranean Sea, at the meeting
point of Europe, Asia and Africa. This strategic position has played an important role in the
development of Cyprus into a centre for international business and tourism. Paphos is a
mature and well-established area and has been popular with British holidaymakers for years.
The city of Paphos on the southwest coast of Cyprus was the capital of the island in Roman
times, and dates from 1400 BC.

t has been written in Greek mythology that the area of Paphos is where the Greek Goddess of
Love, Aphrodite rose from the waves at the spot marked by ‘Aphrodite's Rock’. Paphos played
an important role in the times of early Christianity and there are many historical connections.
With this historic and archaeological wealth, parts of Paphos have been declared as UNESCO
World Cultural Heritage Sites.

Cyprus is a member of the United Nations, the Commonwealth, and the Council of Europe and
has joined the European Union - May 2004. Cyprus has the best economy amongst the
countries to join the E.U. in May 2004.

Apart from the strategic location of the island and the excellent telecommunications and easy
access by air and sea, Cyprus provides the following additional attractions to foreign
investors:-

Location

Cyprus, republic, and third-largest island in the Mediterranean Sea, located west of Syria and
south of Turkey. The island has a maximum length of about 225 km (140 miles) from Cape
Andreas in the north-east to the western extremity of the island. Its maximum width, from
Cape Gata in the south to Cape Kormakiti in the north, is about 97 km (60 miles). The total
area of the country is 9,251 sq km (3,572 sq mi). Nicosia is the capital and largest city.

Climate

Cyprus has a typical Mediterranean climate, with summers that are hot and dry and a cool,
rainy season that extends from October to March. This mean annual temperature is 20.6° C
(69° F). The annual rainfall averages less than 500 mm (20 in).

Population

Greek-speaking Cypriots make up about 80 per cent of the population, and the remainder is
made up of European, Turkish extraction, Armenians and other ethnic groups. The Greek
community has retained its way of life, and customs to a great extent.
Population characteristics
The combined population of approximately 950,000 and the overall population density is about
82 per sq km.

Religions

Members of the Greek community adhere to the Church of Cyprus, which is in doctrinal
agreement with the Eastern Orthodox Church, but is independent and has no allegiance to
any patriarch. The archbishop primate is bishop of Nicosia. The Turkish minority is mostly
Muslim. Other small religious groups include Maronites (Christian Arabs), Roman Catholics,
and Jews. Learn more information about Arabic For Beginners here.

Languages

Greek, English and Turkish are the predominant languages taught in schools and used in
broadcasting. English is widely spoken in the main towns and cities. Cypriot Greek, although
related to the language of the Greek mainland, is a dialect believed by language scholars to
resemble more closely the speech of ancient Greece.

Government type

Greek Cypriot Government is democratically elected

International Organizations

Cyprus is a member of the UN, the Commonwealth of Nations, and the Council of Europe. In
May 2004 Cyprus joined the European Union

Communications

Satellite communication systems and digital television are widely used, receiving both Greek
and English language programmes.

Legal system

A Supreme Court heads the legal system in Cyprus. Lesser tribunals include assize courts
and district courts.

Economy

Cyprus had a gross national product in 1999 (World Bank estimate) of about US$ 9,086
million, this is equivalent to about US$ 11,950 per capita.

Tourism in Cyprus

With over 3 million people visiting the Island of Aphrodite each year, Cyprus is one of the
world’s favourite holiday destinations - Key facts about tourism in Cyprus.

• Major tourist destination with +3.5 Million tourists per annum
• A Growing European population
• English-based legal and education system
• Strong, stable currency
• Democratically elected government in the world
• Former British colony, so familiar 'feel' for UK visitors
• Charming, polite, sociable people.
• Superb climate and food
• English universally spoken and understood
• Property laws similar to UK model
• Banking system with strong UK links
• Low cost of living with low inflation and attractive finance rates
  

Why Invest in Cyprus?

Cyprus is one of the world’s favourite holiday destinations with over three million people
visiting the island of Aphrodite each year. Apartments in the Paphos area represents a good
investment as a holiday home or a safe buy-to-let investment, when coupled with capital
growth in property, in Paphos for the past year rising by a healthy 10 to 15%.

Properties in Paphos

Properties in Paphos represent excellent value for money holiday homes or investment
opportunities. The growth in the property purchase and rental market in the Paphos area is
exceptional, as this is one of the most popular destinations in Cyprus. Apartments close to
facilities in Paphos are exceptionally popular with couples and families alike for holidays.
Property in Paphos and surrounding villages is becoming increasingly popular with British
people due to the developed infrastructure of Cyprus and its recent membership to the
European Union;

Despite the property construction increase in and around Paphos, the area retains its
character and the scenery of its surrounding s is breathtaking.

• One of the fastest growing economies in the region
• Strategic location - close to Europe, Asia, Africa
• Free unrestricted access for EU passport holders
• Good communications infrastructure Satellite and digital systems country-wide
• High quality development properties in prime areas available
• Strong up side for capital growth - especially in the "South West"
• Attractive, well-priced properties with strong rental demand
• Legal system, similar to British based property laws and environment.
• Freehold ownership
• Southern Cyprus offers security of title
• Effective Land Registry and transparency in property transactions
• English language widely used.
• Property sale agreements are in English
• English language newspapers, radio and television available everywhere
• UK trained lawyers.
• No investment problems
• Tax Advantages
• Car import duties and taxes wived for expatriate residents
• No complications, No requirement for a company, or local "partners"
• Costs of purchase and resale are very low
• Low Capital gains tax on immovable property
• Strong demand for resale properties from overseas and local expatriates
• EU investors already active in the market and expected to grow
• The Cyprus government actively seeking to promote overseas purchases
• Low cost of living: food, petrol, clothing and EU priced luxury goods etc.
• Low cost of public and rented transport around the island
• Daily flights and low fares from Europe and the UK
• Excellent climate
• Superb golf , sports and water sport facilities
• Warm, friendly people; and pro European/British
• Superb selection food and locally produced wines.
• Ultra low unemployment rate
• Ultra low crime level
  

Other Expenses : general information

ƒ The Immovable Property (Tenure, Registration and Valuation) Law
This law was enacted in 1946, replacing the Ottoman Land Law prevailing until then, dealing
with tenure, registration, disposition and valuation of immovable property, within the
framework of the Land Registry system, by which immovable property is technically defined
and drawn, legally recognised, secured and financially valued. The Land Registry system of
Cyprus is unique, and effective, all transactions relating to immovable property are safe and
protected. Cyprus maintains an accurate Land Registry system.
ƒ Immovable Property tax payable yearly and based on the property’s value in 1980, ranging
from nil to 0.4% based on the value of your property.
ƒ The Sale of Land (Specific Performance) Law

Under this law a purchaser of immovable property may secure the remedy of specific
performance, by depositing a duly stamped copy of the contract with the Land Registry
within 2 months from the date of the execution thereof, thus preventing the vendor from
transferring property elsewhere or charging it for as long as the contract is valid and legally
effective. Your Solicitor will register the property at the Cyprus Land Registry Office (for a
fee of typically £400 - £1200 depending on the value of the property) This blocks any
possible attempt by the vendor to re-sell, mortgage or refuse to transfer the title deeds of
your property to you in the future.

ƒ The Acquisition of Immovable Property (Aliens) Law
According to this law, no foreigner can acquire immovable property without the prior
permission of the Council of Ministers. (To date no UK citizen has ever been refused.)
The transfer of immovable property can be affected once permission to acquire has been
granted and the Central Bank has certified the import of funds. Transfer fees are payable by
the purchaser on the sale price or under certain circumstances, on the current market value
as follows:

Current Market Value in CYP

• Value from Value to Transfer fees
• 50,000 3%
• 0,001 100,000 5%
• 100,001 over 8%

ƒ Foreigners are entitled to borrow money for the purchase of immovable property upon
mortgaging such property to the Bank from which they borrow the money.
ƒ Acquiring the Title Deed
Transfer of ownership from vendor to purchaser is accomplished by a simple procedure
through the Cyprus Land Registry Office, either by the buyer in person or by appointed third
party with a Power of Attorney. The contract of sale must be in writing, and it is advisable
that such contracts be registered at the District Land Registry Office within sixty days from
the contract date. This protects the buyer’s rights to the property and provides additional
safeguards. When issued, the title deed will be register in the name of the buyer, and will be
recorded in the Government archives. At any time after the purchase, the buyer may sell or
dispose of the property at will, provided that he/she has a valid contract. Title deeds can
take up to 3 years to be issued.
ƒ Taxes & Fees
The transfer of title can be affected once the Council of Ministers’ permission is obtained.
Upon transfer of the property and registration in the purchaser’s name, the District Land
Registry Office will charge Transfer Fees, which are based on the market value of the
property at the time of purchase.
However if the property is purchased jointly by a couple, the property purchase prices is split
equally into two parts and then taxed which is beneficial to the purchasers.
ƒ Stamp Duty
Stamp duty is due at the time of signing the contract. Stamp duty is levied at the rate of
CY£1.50 per CY£1,000 up to CY£100,000 (0.15%) and thereafter at the rate of CY£2 per
CY£1,000 (0.2%). The purchase contract must be stamped within 30 days of its dated
signature.
ƒ Immovable Property Tax, Services Tax
The annual immovable property ownership tax imposed by the government is approximately
CY£ 60 to 120 per year, depending on the value of the property. The Municipal authorities
also levy an annual property tax at the rate of about CY£ 20 to 30 per year.
ƒ If you buy an apartment within a block, you will pay a management, service fee for general
maintenance and repairs for the common areas, and utilities such as lighting, cleaning,
gardens, painting and swimming pool maintenance etc.

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