How To Buy

The Republic of Cyprus is a safe place to buy property provided that the correct legal steps are followed. The legal system is loosely based on the British system and English contract law and there is a reliable (if slow) system for the registration of land.

Restrictions on Buyers

The first matter a buyer should determine is whether they may in fact purchase a property in Cyprus. In line with EU accession the General Attorney in Cyprus has given consent to District Officers to lift previous restrictions on EU citizens.

  1. Citizens of EU member states can now purchase and transfer into their names any amount of land and property in Cyprus.
  2. Non-EU citizens can purchase one apartment or a house or villa which is under construction or built on an area not exceeding 2676 square meters (2 donums).
  3. A company with a majority of directors and shareholders who are Europeans [including Cypriots] is not considered to be a foreign company and can buy any amount of land and property in Cyprus.

Property for Sale in Cyprus in Aphrodite Hills Resort, Paphos | Property  Developer & Official Sales Office

Reservation Fees

Once a buyer has found the property that they wish to buy in Cyprus they will usually be asked to pay a reservation fee. It is important to have a signed reservation fee agreement drawn up which will outline the circumstances in which the reservation fee will be returned to the buyer or retained by the seller.

For example, it should say that if the sale does not go through because of a defect in the title the reservation fee will be returned and that the reservation fee is to be deducted from the actual purchase price on completion.

It is safer to agree that the agent or lawyer will hold the fee rather than the seller.

Due Diligence

A lawyer should carry out certain due diligence before advising a buyer to proceed.

This includes:

  • Carry out an encumbrance search at the Land Registry - to reveal any mortgages, charges or other adverse matters such as memos, a caution or court judgment against the title
  • Carry out a company search - to find out the financial status of a selling company or use a credit reference company
  • Obtain the planning and building permits and the final certificate if such exists.

Negotiation and Signing of the Contract

Property in Cyprus is often purchased in the first instance by a Contract of Sale, the terms of which should be negotiated by a lawyer who is experienced in such transactions. A developer may want to use his own sale agreement but this can be modified. Often it is better to start over in order to achieve a contract that will protect the buyer's interests. Probably the biggest mistake made by buyers in Cyprus is to sign the developer's standard contract without taking legal advice.

The contract will be signed by the buyer first. Then the developer will sign when the first payment due under the terms of the contract is made. This is equivalent to the "exchange of contracts" stage that UK buyers will be familiar with.

Stamp duty

Once the agreement has been signed, it will be stamped at the tax office to show that the stamp duty applicable to the Contract is paid; a copy of the sale agreement will then be deposited with the Land Registry.

Stamp duty in Cyprus is not the same as stamp duty in other countries. In the UK, transfer fees are the closest equivalent.

Depositing the contract

The contract can then be taken to the Land Registry and deposited. This prevents the seller, from mortgaging, charging, reselling, or otherwise interfering with the buyer's rights to the property, until the separate title deed is ready.

Transfer Fees

Transfer fees must be paid in order to transfer freehold ownership into the name of the purchaser. The transferee is responsible for the tax payment and it is payable to the Government at the time of the transfer of the property and the issue of a title deed in the name of the purchaser.

On full settlement of the purchase price, the property can be transferred into the name of the purchaser at the Land Registry. However, this can not be done until the relevant Government authority has issued the title deed. This will not happen until the District Land Registry Office has processed any necessary plot divisions on a development. The key is the administration time taken by the District Land Registry Office and this can be many years and delays of over five years are common.

The rates are on a graduated scale.

The transfer fees are:

  • 3% on purchase prices up to €85,430
  • 5% on the next €85,430
  • 8% on the rest


Since 01/05/2004 a new statute in respect of VAT on properties has been introduced. Disposals of newly-constructed properties for which a proper application for planning permit has been submitted with the relevant authorities after 01/05/2004 are subject to VAT at the standard rate (currently 19%).

Since 08/06/2012 any person that is buying his/her first permanent residence in Cyprus can apply for a reduced VAT rate (defined at 5%).

It is no longer required (as was previously) to become a permanent resident first and then to apply for the special rate of 5% VAT. The purchaser must complete a form at the VAT Authorities (like all Cypriot nationals) declaring his/her intention and commitment to use the house that he/she is purchasing, as the permanent residence for himself and /or his family in Cyprus. The same procedure and set of documents, as before, need to be provided in order to secure the certificate from VAT. (This process is the same procedure followed by all Cypriot nationals).

Purchase Where Deeds are Available

Some of the above matters are not relevant where the deeds are already available for the property being purchased. As this is relatively rare, this article has concentrated on the no deeds situation above.

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