A bit of history
Because of the cordiality of the Cypriots, the warm climate, visa-free regime from lots of countries, and transport accessibility Cyprus became one of the favorite vacation spots for the residents. When people come to Cyprus for vacations, some begin to look closely at the Cypriot real estate for the purchase of a second house, summer residence or a place where they can spend the last years of their life.
What advantages did the investors have before 2013?
Those who invested in real estate in Limassol tourist areas before 2008 had obvious advantages. For example, in 2000 it was possible to buy a seafront 3-bedroom apartment in Limassol, in the center of the tourist zone, in an ordinary house built in 1986 for 40,900 Cypriot pounds ($ 90,000).
Now, 20 years later, this apartment costs $360,000... But the most successful investors did not buy villas in Cyprus, as they preferred land plots.
For example, in 2003, a land plot with its own descent to the sea near Paphos of 30 acres (3,000 m2) could be bought for 200,000 Cypriot pounds ($ 440,000), now this land costs at least $ 4,000,000 ...
What disadvantages did the investors have before 2013?
Of course, there were also bad investments.
As a rule, what was bought outside of Limassol (if it is not land near the sea) is now not in high demand. And inexpensive real estate, if it is in demand, is often cheaper than it cost 15-20 years ago.
For example, there were cases when buyers acquired apartments in Upper Paphos (4 km from the sea) in a new 4-storey economy class building in 2003. He bought a three-bedroom apartment in this house with a total area of 120 m2 for 64,000 Cypriot pounds (EUR 108,800). A couple of years ago, he put this apartment up for sale at a price of € 120,000, but there was no buyer. Today this apartment can be sold for no more than € 95,000.
What about premium real estate in Cyprus?
On the island, location plays a decisive role in determining the price of an object.
If we talk about real estate for foreigners, then the main criteria in choosing an object is the proximity to the sea. Therefore, the tourist area of Limassol is the most expensive place, where the cost of economy class houses starts from € 3000 - € 4000 per 1m2.
The cost of premium seafront properties can be to € 12-15 million for a villa of 350-400 m2 and a land plot of 1500 m2.
All other premium real estate objects that are built in the regions of Larnaca, Paphos, Polis, Famagusta are cheaper and are sold only at a good discount. Sometimes the owners sell their villas in the mountains even below their real cost.
Where to invest now?
If we talk about investing in real estate in Cyprus at the moment, then making a purchase decision needs to be more deliberate than 15-20 years ago.
We should remember that the price of real estate has not been growing at the same rate as 20 years ago, thus these investment options should be considered:
- new objects (villas and apartments) located in Limassol in the tourist area or closest suburbs
- seafront secondary housing located
- the most valuable thing in Cyprus is land. It is believed that investing in liquid land plots in Cyprus is an investment in a “land bank” that is not subject to inflationary and other risks.
But what to do if you like Larnaca and Paphos or Troodos?
So far we have been talking about investments, that is, investments that should be profitable and, if necessary, be sold without losing the original value. But if you are buying real estate for personal use, then there may be other selection criteria.
If you like Paphos or Larnaca, or Troodos mountains, why not choose a property there? In this case, the real estate price can be much cheaper than in Limassol. For example, you can find mountain homes for sale in Cyprus on the slope of a gorge even for € 70,000. And if you dream of building a house, then a land plot in such a village will be even cheaper.
Cyprus residence permit
Along with investing in real estate in Cyprus, you can obtain a residence permit: temporary or permanent.
What is the difference?
Permanent residence in Cyprus is granted without any time limit. The condition for obtaining is the purchase of real estate in the amount of € 300,000 excluding VAT. Only new buildings can participate in the program. The processing time takes only up to 3 months and is issued for all family members (spouses and children under 25). The owner of permanent residence is not obliged to move and live in Cyprus permanently as it is enough to visit Cyprus at least once every two years. If it is not planned to live permanently in Cyprus, then the purchased property can be rented out and receive a permanent income. And later it will be possible to obtain a Cyprus passport by naturalization.
For more information on the conditions for obtaining permanent residence in Cyprus, please follow the link.
Residence permit in Cyprus allows you to stay on the island for more than 90 days in half a year. To participate in the program, you must rent a house for a long-term lease or buy your own for any amount. A residence permit is issued for a year, with possible renewals. It is not allowed to leave Cyprus for more than three months at once, otherwise the residence permit will be canceled.
For more information on the conditions of residence permit, please follow the link.
Advantages of investing in real estate in Cyprus:
- the opportunity to obtain a residence in order to spend more time in Cyprus (where summer is all year round)
- attractive taxation system for foreigners
- the opportunity to get a mortgage
- presence of English schools
- the opportunity to continue studying in the UK and the USA after finishing an English school
- employment opportunity
- convenient location of the island at the crossroads between Europe and Asia
- the opportunity to obtain a Cypriot passport by naturalization after 7 years
- a large selection of universities with programs in English
- the ability to quickly sell your property if your property has a good location
- the opportunity to use private and public medicine
- the opportunity to live in a country with a calm and relaxed rhythm of life.
Disadvantages of investing in Cyprus property:
- Cyprus dispute
- tensions in relations between Cyprus and Turkey over the discovered gas fields
- high cost of some real estate
- lack of central heating in houses
- Cypriot residence permit does not give the right to work legally
- left-hand traffic
- hot summer, lack of flora and fauna because of subtropical climate
- expensive gasoline.
The choice for real estate investment is always very individual. Cyprus, as elsewhere, has its pros and cons. If you want to find a dream home for permanent residence, you can buy wherever you wish. If you invest in order to get the opportunity to live in Europe in the future or to make a profit from the object, then you need to think about everything first.
Thinking about buying real estate and obtaining a permanent residence or residence permit in Cyprus? DOM real estate Cyprus specialists will help you to find suitable properties for you, advise you how to obtain a residence permit. And all these services are absolutely free. Get a consultation right now.
- Should you buy property in Larnaca? (link)
- Features of seafront real estate in Cyprus (link)
- Limassol city overview: a place to live, relax and invest (link)
- Where to buy property in Limassol to rent out? (link)
Photos: DOM LiVE