Why It's Better to Buy Your Own Apartment on Cyprus with a Mortgage Than to Rent Someone Else's?
Cyprus is one of the few countries in Europe where real estate is relatively affordable. Both in terms of rent and purchase. If there are conditions for obtaining a mortgage, solving the housing issue becomes a bit easier, and the choice of decent options significantly expands.
Of course, in both cases—renting and buying with a mortgage—there are significant pros and cons. Renting allows you to move freely, explore different areas and cities, switching from one to another, or even leave the country at any time. It involves less hassle. On the other hand, buying enables a more settled lifestyle and the ability to organize personal space to your liking. Still, real estate is a matter of its own—the kind that can be bought and sold, silently waiting for its owner for years, sometimes even appreciating in value.
My home is my castle
Considering the sharp rise in rental prices over the past couple of years, mortgage today appears to be a more stable means of improving living conditions. On average, the monthly mortgage payment is around 800 euros (for an apartment priced at approximately 200,000 euros, financed over 15-20 years). At this price, you would only be able to rent a decent 1-bedroom apartment. The situation might change, but experts assert that rental prices for housing won't change significantly. In general, for many, the issue comes down to the down payment to the bank, which usually ranges from 20% to 40% of the property value.
Moreover, living in Cyprus for an extended period of time, it would be beneficial to become a full-fledged citizen, have a voice and political influence; otherwise, decisions will be made for you. So, in order to obtain citizenship, ideally, you not only need to learn Greek and be a law-abiding resident but also purchase some real estate and indicate that you're here seriously and for the long term. Let this be your family's first home, with a pleasant VAT discount of up to 5% (instead of 19%). The Cypriot government provides these incentives for a reason—they truly await and value you here.
No Risk of Eviction at the Worst Moment
By buying property with a mortgage, you decide when you want to vacate the premises. In long-term rentals, the owner has the right to terminate the contract after the specified period. This could be due to a simple desire to increase rent, selling the apartment, and many other reasons. Of course, this comparison doesn't apply to situations where the mortgage becomes a burden for the borrower, and the bank is forced to auction the property. Choose property that truly suits your budget, and everything will be fine.
In Your Apartment, You Can Do Whatever You Want!
Agree that investing significant funds in rented housing is somewhat illogical. It's clean and fine. This moment forces us to reconcile with facts that are generally endurable but restrict our imagination and full-fledged existence in this beautiful world, full of delightful design solutions.
Property Owners Can Cooperate with Neighbors and Improve the Surrounding Space
Drainage isn't working, the roof leaks, parking is chaotic due to mischievous cats—all these issues are solvable when there's a strong management board in the house or residential complex, capable of resolving any issue. Sometimes financial contributions are required to resolve these matters. It's no secret that people take better care of their own home, especially when they know they'll live there for many more years and even pass it on to their children. Addressing issues collectively is much more effective.
Learning to Manage Efficiently. An Invaluable Skill
Not everyone is naturally inclined to manage household matters. If you continue to live in a rented home for a long time, the skill doesn't develop as intensely as it would in your own place. Sure, you can always try to find specialists willing to help, but understanding the processes of your surroundings is important. Where the water comes from in your house, what to do in case of a fire, how important eco-friendly insulation is, and more.
Sincerely Rejoice When Real Estate Prices Rise
A little plump miser smiles contentedly as he looks at the growing real estate price index. Of course, if it's in his favor. Even property owners, even if it's mortgaged, also feel on top of the world. With one caveat. Construction material prices usually rise in parallel. And finished housing eventually requires renovation. Considerable financial gains can only be contemplated in the long term and on a larger scale than just a single apartment in Cyprus. Knowledgeable investors rarely opt for real estate when buying stocks on the stock exchange, although it might make up a small fraction of the overall investment portfolio.
You Can Rent Out the Apartment
Generally, property is rented out either for stable income purposes or if it's inconveniently located, too bothersome for the owner to live in it themselves. The profitability is tangible when renting out a newly built property that doesn't require constant renovation. Otherwise, the entire process takes up so much time, effort, and resources that the endeavor loses its initial meaning. Nevertheless, considering the current difference between monthly rent and monthly bank payments, there's a chance you'll cover the monthly payments and still have something left for renovating the apartment.
A Little Bonus. No Need to Make a Deposit When Paying for Water and Electricity
When renting an apartment in Cyprus, a small deposit (200 euros) is required when transferring utility bills to the tenant's name. The owner, however, pays only for the resources used. Moreover, not every tenant knows that an annual fee for garbage disposal is required, often included in the rent. The price is precisely equivalent to the deposit for water.
By Buying an Apartment with a Mortgage, You Do Everything Right, Including Property Insurance, Which Many Neglect
It's no secret that not everyone is willing to pay an extra 200-300 euros for property insurance against fire, earthquakes, and the like. Not out of greed, but simply due to a positive mindset fostered by 365 sunny days a year. Ask your acquaintances who own houses and apartments about insurance. You'll be surprised by how carefree people are about such matters. On the other hand, mortgage holders are fully educated. They not only insure their property and their lives but also track interesting and more advantageous novelties in the insurance market.
You Can Sell a Mortgage Apartment at Any Time
A noose, not a fortress? Well then, sell the mortgaged apartment. This type of transaction is quite common in Cyprus. People mortgage mortgage apartments, new buildings at any stage of construction, and secondary housing—anything goes. The difference lies in the value-added tax and profit taxes. The key is to do it wisely and prudently. You can sell a mortgage apartment through the bank where you obtained the credit. This is one of the most transparent real estate transaction types.
Read also:
- Fire Safety in High-Rise Buildings in Cyprus
- Buying Property in Cyprus: Personal Experience
- Why IT Specialists Are Moving to Cyprus
- Mortgage Insurance in Cyprus: Who, Why, and Can You Opt Out?
- Property Management Agreement in Cyprus for Rent
- Digital Nomad Visa: How to Become a Digital Wanderer in Cyprus?
