What are the associated costs?
The cost of buying a home in Cyprus varies depending on whether you are buying a new build or a resale property. As a general rule, you should budget up to 10% of the purchase price. The following is a breakdown of the charges:
VAT (Value Added Tax): This is due at the regular rate of 19 percent for new-build property. It’s frequently included in the purchase price of a property.
Stamp duty ranges from 0.15 percent to 0.20 percent.
Bank fees: This includes the mortgage valuation cost, which you’ll have to pay even if your loan is denied.
Fees for surveyors: While a survey is not required, it is a good idea.
A transfer fee is paid at the time the deeds are transferred to the Land Registry. It is calculated on a sliding scale from 3% to 8% of the purchase price, depending on the property’s value. (It’s worth noting that fees are lower when buying in joint names because the purchase price is split between the two parties.)
Legal Fees: These will vary depending on the property’s value, but a good lawyer is worth the extra money.
How can I get a loan to buy a house in Cyprus?
If you have enough cash to buy your Cypriot home using current finances or a remortgage of your UK home, skip forward to our currency exchange section. If you don’t, you’ll have to think about your borrowing possibilities.
It’s worth noting that only a few banks will issue a UK-based mortgage for a residence located in another country. All of the major UK high street banks offer an overseas service, but you should double-check which countries they cover. While the mortgage may be put up in the United Kingdom, you will be dealing with the bank’s foreign branch once it is completed. Non-residents, on the other hand, are allowed to take out mortgages on Cypriot property from a Cypriot bank; a professional overseas mortgage broker can assist you in finding the best prices.
Mortgages are commonly available in Cyprus, and the terms are comparable to those in the United Kingdom. A deposit of at least 30% is required, and the loan is typically repaid over 15 years, depending on your age.
A property value will be required for all mortgage applications before the loan can be authorized. The greater your deposit, the better your rate will be, however mortgage rates are currently between 3% and 4%.
Keep in mind that borrowing in the same currency as the loan’s repayment is a good idea. Currency swings will not work against you as a result of this. If you’re paying your mortgage with a UK paycheck, for example, borrow in pounds. If you want to finance your purchase by renting out your Cypriot house, you might choose to borrow in euros because that’s what you’ll get paid in.
Who should I contact for assistance with my purchase?
Using a solicitor is the usual in Cyprus because the conveyancing process is remarkably similar to that in the United Kingdom. However, a good independent lawyer who will just work for you and protect your interests is also suggested.
Ascertain that your lawyer has no ties to the agency or developer. Even if your agent recommends a fantastic one that ‘they usually work with,’ be skeptical because there’s a chance they have a financial relationship. One method to get around this is to hire a lawyer first. Check out the AIPP website for a list of Cypriot property lawyers based in the United Kingdom and Cyprus.
Now it’s over to your representative. You might have found one at a property show or online, but it’s still important to do your homework. The Estate Agents Registration Council regulates and licenses estate agents in Cyprus. However, there are still unregistered sales agents working in Cyprus, so make sure your agent is a member of a trade group like the AIPP. This gives you the right to file a complaint with a property ombudsman and receive cash compensation.
A surveyor isn’t required by law, but if you’re buying a property that’s had a lot of work done to it or needs a lot of work done, it’s an excellent way to avoid unpleasant surprises. As a general rule, if you’d commission a survey on a property you’re buying in the United Kingdom, you should do the same in Cyprus.
You may need to purchase foreign currency in order to complete the property, so choose a company that can provide an alternative to your bank. A regulated currency professional can guide you through the procedure, ensuring that your funds are transferred safely, quickly, and expertly, saving you time and money. Finally, if you’re moving your belongings, you might need to hire a moving company. It is important to find an insured company that is a member of an organisation, just as it is in the UK. When transporting your items to Cyprus, specialist overseas removal specialists will guide you through the procedure and advise you on storage, sea transit, and any rules you may be ignorant of.
Are you thinking of selling your Cypriot property? Things to think about!
1. Make sure you have your title deeds — this will instantly improve the property’s appeal to potential purchasers.
2. Choose your agent carefully, and determine if you want to sell with numerous agencies or simply one – the sales commission you pay will be affected.
3. Capital Gains Tax in Cyprus differs from the UK in that you must pay it when you sell your home, even if it is your primary residence.
4. Be realistic about the price you’re asking, especially if the area has a lot of similar houses for sale.
to be continue