Cyprus is becoming an increasingly attractive place to buy property due to its mild climate, favourable taxation and high standard of living. One of the most popular ways of buying a home is to purchase an apartment in installments from a developer. In this article we will look at the main stages of this process and give recommendations on how to complete it successfully.
When we talk about installments in Cyprus, we are usually talking about off-plan projects and the installments are for 1-3 years. Accordingly, the instlalments are for this period. The client pays 30-40% at the time of the contract and then 10-20% after each stage of construction (frame, brickwork, tiles, windows etc). When construction is completed, the property must be paid for in full," says Irina Eroshenko, head of DOM's regional office.
1. Determine your budget and property requirements
Before starting the purchase process, it is important to determine your budget and requirements for your future home:
- Budget. Calculate how much money you are prepared to spend on a deposit and other payments. Take into account all possible expenses, including tax payments, utilities and any additional maintenance fees.
- Requirements. Identify your preferred location (close to the sea, city centre or quiet area), the size of the property, number of rooms, balcony or terrace, views from the windows, infrastructure (availability of shops, schools, medical facilities) and other features that are important to you.
2. Choosing a developer and familiarising yourself with the projects
There are many developers in Cyprus offering various residential projects on an installment basis. It is important to choose a reliable and trustworthy developer:
- Reputation. Research the developer's reviews and reputation in the market. Check how long they have been in the market, whether they have completed any projects and how well they meet their deadlines and quality standards.
- Projects. View completed and ongoing projects to assess the quality of construction and how well they meet your requirements. Visit construction sites yourself, talk to residents of completed projects to get a real picture of the developer's work.
3. Payment in installments
Each developer will offer their own payment terms, which can vary considerably. It is important to study and compare them carefully:
- Deposit. Find out the amount of the deposit, which is usually 30-40% of the cost of the apartment. Make sure that this amount is affordable and will not cause financial difficulties.
- Installments. Determine the term of the installment - it can vary from 1 to 5 years. The longer the term, the lower the payments will be, but the total cost of the apartment may increase due to possible interest. The cost of the apartment cannot increase. The price is fixed when the contract is signed.
- Interest rates. Check with the developer about interest rates on the outstanding amount. Some developers offer interest-free installments, which is a very good deal for buyers. This is the most common arrangement in Cyprus.
There may be delays in construction on the part of the developer, then, if it is specified in the contract, he may pay penalties for late performance, - adds broker Irina Eroshenko.
4. Drawing up and signing the contract
Once you have chosen your home and agreed to the terms of the installment plan, the next step is to prepare and sign the contract:
- Legal check. It is advisable to carry out a legal check of the contract to ensure that there are no hidden conditions and that it has been drawn up correctly. It is important that the contract is transparent and does not contain clauses that could be interpreted ambiguously.
- Sign the contract. Sign the sale and purchase agreement and installment contract with the developer. Make sure that all the terms and conditions you have agreed are clearly spelt out in the contract, including the payment schedule and penalties for late payment.
5. Deposit and payments
- Once you have signed the contract, you will need to make a deposit and start making regular payments:
- Deposit. Transfer the agreed amount to the developer's bank account. Get confirmation of this amount and keep all documents relating to the payment. It is not unreasonable to make copies.
- Payments. These can be made monthly or much less frequently, as agreed. Keep track of payments to avoid penalties. It is advisable to set up automatic payments through your bank to avoid late payments.
6. Title deeds
Once all payments for the apartment have been completed, the developer must issue a title deed in your name:
- Documents. Obtain all the necessary documents to prove your ownership of the apartment. This may include the deed of sale, certificates of good standing and others. But the most important is the title deed. You will have to wait for this. Sometimes the speed with which the title deeds are issued has nothing to do with the quality of the developer's work, but with bureaucratic delays in a particular municipality.
- Registration. Register the title with the relevant government authority. In Cyprus, this is the Land Registry Department. This process may involve notarising documents, paying registration fees and receiving an official certificate of registration.
Why should I use an estate agent when buying on instalments?
The process of buying an apartment on installments from a developer can be complicated and requires experience, attention to detail and sometimes a good knowledge of a foreign language. While many buyers try to save money by avoiding estate agents, this does not always lead to the desired result. Here are some reasons why you should consider using a professional:
- Expert knowledge of the market. Licensed estate agents have in-depth knowledge of the market and can suggest the best options to suit your requirements. They know which developers are reliable, which projects are in the pipeline and where you can get the best deal.
- Legal and moral support. Professional agencies offer legal support to help you avoid problems with documents and deal execution. The agency's lawyers will check all the documents and terms of the contract so that you are protected from any possible risks. A good agent will become your true friend and support not only during the buying process but also afterwards.
- Negotiations. Agents can help you negotiate with the developer to get the best installment terms. Professional agents know how to negotiate and can reduce the deposit, increase the payment period or even get a discount on the total cost of the property.
- Save time. Agencies take care of all the organisational issues, saving you time and effort. They will organise meetings with developers, help you collect and prepare all the necessary documents and guide you through all stages of the transaction.
Buying a property in installments from a developer in Cyprus is a great way to own a property without having to pay the entire amount in one lump sum. However, the process requires careful preparation and attention to detail. Using a professional estate agent can make your task much easier by ensuring that all the paperwork is completed correctly and that the transaction is completed successfully. Professionals will help you avoid potential mistakes and problems and make the buying process as comfortable and secure as possible.
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