Cyprus: Opportunities For Investment In Real Property In Cyprus

Last Updated: 6 May 2005

Cyprus, the third largest island in the Mediterranean, is situated at the crossroads of Europe, Asia, the Middle East and Africa. Its strategic location, sound legal system, excellent infrastructure and reliable communications, relatively low cost of living, superb climate and the friendliness and hospitality of its people are just some of the advantages that have contributed to its continuing development as an international business centre and as a tourist resort.

The island became a full member of the European Union on 1 May 2004. As a result of this move, seen as crucial to its continued growth, Cyprus is increasingly attractive to foreign investors, who can take advantage of the low tax incentives and relatively low level of taxation.

Man’s affinity with land stems from time immemorial and it has always been considered as one of the most precious commodities. As a finite resource, it is continuing to increase in value to meet the demands of a growing world population with rising social and economic aspirations.

In Cyprus, a suitable legal framework has been created to regulate the rights of occupation and ownership of immovable property and to protect the social, economic, agricultural and industrial interests of the island and its people, while allowing the involvement of the island in the international land market. It operates through a series of laws which are regularly amended to meet everyday demands and balance conflicting interests in this vital sector of the economy.

Cyprus has proved to be one of the more popular destinations for Europeans regarding holiday/retirement homes (it ranks third in popularity after Spain and Portugal) and, following its accession to the EU, there has never been a better time to invest in property there. Experience has shown that real estate prices have always risen after a country has joined the EU. The best example of this was Spain, where prices more than doubled in the years following the accession of that country.

In Cyprus as well as Spain the equity required is limited to 30% of the purchase price. Because the initial outlay is relatively low compared to the value of the property, it is possible to realise gains in the region of 80 – 120%, particularly when Cyprus’ favourable tax regime is taken into account.

Demand for property is rising fast. According to the statistics, sales doubled between the years 2000-2002 and doubled again between 2003-2004. The sales are expected to increase during 2005-2006.

Buying property in Cyprus is a safe and profitable exercise and offers the following benefits amongst others:

  • The investment is secured by the laws of the Republic.
  • Properties cost much less than in the UK, Portugal and Spain.
  • Properties are easy to let as holiday homes. Income from lettings should more than cover any mortgage instalments.
  • Good weather conditions (an average of 320 sunshine days) and Cypriot hospitality.
  • Easy communication (Cypriots speak at least one extra language – mainly English, German, Italian or French).
  • A low cost of living, an inflation rate of about 2.3% and an unemployment rate of about 4.7%.
  • A low crime rate, 6% of that of the UK, 8% of Germany, 30% of Portugal and Spain.
  • A European-standard banking system.
  • Competitive quality of construction.
  • A land registration system providing security of title/protection of ownership for foreign investors. Prospective purchasers are also protected by the Government and the courts.
  • Very reasonable legal fees.
  • The lowest company taxation rate in Europe (10%) and a low rate of VAT (15%).
  • Exemption of the first CYP 10.000 of any profit from capital gains tax as well as inflation allowances.
  • The double taxation treaties which Cyprus has signed with no less than 36 countries.
  • A tax on pensions of 5%.
  • No estate duty (inheritance tax) for people domiciled in Cyprus.

Foreigners (non-Cypriots) purchasing immovable property in Cyprus must obtain a licence from the Council of Ministers to acquire such property. Licences are granted to all bona fide purchasers for houses, flats, building sites or land up to 4,000 sq. metres. Since the accession of Cyprus to the EU the need to obtain license for land has been abolished for EU citizens, but not for houses or flats, unless the EU citizen is permanent resident of Cyprus.

When a foreigner purchases property in Cyprus the usual steps that a lawyer has to take in order to safeguard his client’s interests are as follows:

  • Search on the title deeds of the property.
  • Agreement on the final form of the contract, execution thereof and payment of the deposit.
  • Stamp and deposit the contract with the Land Registry for specific performance.
  • Prepare and submit the application to the Council of Ministers for a licence to acquire the property. The application is made in the prescribed form, accompanied by a copy of the contract, title deeds, plans and other necessary documents. The licence takes 6-7 months to obtain, but it remains a formality especially for EU citizens.
  • On obtaining the licence and on full settlement of the purchase price, attendance at the Land Registry to transfer the property into the name of the client.

Following the above steps is important, as if a purchaser or his lawyer stamps and deposits the contract with the Land Registry within two months from the date of signing the agreement, the legal rights of the purchaser are safeguarded and guaranteed by the laws of the Republic. The purchaser has the remedy of specific performance in the event of the seller’s non-compliance with the contract.

This reference to some aspects of the legislation of Cyprus on real estate and property does not, by any means, exhaust the subject, neither does it offer reliable information which may be acted upon without professional advice and guidance, especially as the laws in question are constantly being amended. The accession of Cyprus to the EU on 1st May 2004 has already brought, and is expected to bring more, substantial changes to both the relevant legislation and the applied practice and policy concerning the land market.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Related Topics
Related Articles
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of

To Use you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions