Situated in the northeastern part of the Mediterranean sea and 75 km south of Turkey, Cyprus is the third largest island in the Mediterranean and one of the most popular tourist destinations. With alluring beaches and surrounding mountain peaks, vineyards studded with olive trees and ancient ruins that stir the imagination, citrus groves and old stone villages, this country has something to offer to everyone.
The property market in Cyprus is attractive to locals and foreign investors who see it as a stable and low risk investment guaranteed to yield decent returns. The key reason why the property market is so appealing to foreign investors is that it has European systems in place, low taxation and an excellent communication system.
The service sector is also highly skilled, polished and professional and extremely hospitable. In addition, the unique hospitality of the local people, the attractive climate as well as a safe and secure environment. The island has a vibrant tourist sector that continues to grow yearly. Cyprus also has an excellent business sector that has become a popular offshore location for investors.
Furthermore, the island's economy has been on a steady rise and is once again expected to grow by a decent 3.8 per cent this year. The property market in Cyprus is one of the fastest growing markets in Europe. Property sales are further boosted by regular and increased budget airline services to the international airports of Larnaca and Paphos. Larnaca International Airport receives a lot of air traffic in the summer months from legacy airlines as Air Malta, British Airways and Emirates, while Easy Jet flies to Paphos.
The property market has been on the increase for the past few years and with the country's accession to the European Union and the adoption of the euro, it is likely that the market will remain bullish. Buying real estate in Cyprus is regarded as a solid investment for all types of buyers, from large corporations to individuals.
Some regions offer excellent buy-to-let opportunities, particularly in tourist resorts. After joining the EU, capital growth soared to around 20 per cent per annum. In line with the growth in property prices, rental yields have also shown a strong growth. Short-term yields depending on location range from 8 to 12 per cent of the property value and long-term rental yields average between five to seven per cent.
Buying property in Cyprus is generally considered an easy process. Since many of the inner workings of property exchanges follow European standards, the process in typically quite easy for Europeans to understand. This is a big selling point for investors who do not want to deal with complicated and difficult purchasing procedures.
A luxury lifestyle beckons you to developments offered by Propertyline International. Located in the south of Cyprus in the regions of Paphos, Larnaca and Limassol, all properties are built to highest standards with excellent finishings. The projects, situated in prime locations enjoying panoramic sea, mountain or valley views, are combined with excellent after-sales service, property management and easy payment terms.
Most of the units feature large gardens or patios, and residents can benefit from several onsite facilities such as parking spaces, swimming pools and gymnasium, with prices starting from €102,100. Access to the main towns and airports is just a short drive away. Inspection visits can also be organised should clients wish to view a property before purchasing. Cyprus has many double taxation treaties, which can make life a great deal easier for both resident and non-residents with financial concerns and responsibilities outside the country.
Capital gains from the sale of immovable property are subject to 20 per cent capital gains tax. However, this tax is not payable if you sell the property before taking on the title in the case of an off-plan purchase. Income earned through renting out property is taxable at the normal income tax rates and specific deductions are applicable.
The mortgage market in Cyprus is well developed and you should have no problems financing your property purchase. Most commercial banks offer mortgage facilities to locals and foreigners. Loans are based on the purchaser providing a minimum deposit of 30 per cent with 70 per cent of the purchase prices financed through the mortgage. Whether your dream home is a luxury villa, a town house, a holiday apartment or a rural property, the property market in Cyprus is strong and widely considered to be a solid investment for overseas home-buyers.
Mr Busuttil is managing director, Propertyline International