Auctions of Foreclosed Properties Resume in Cyprus

After lifting the moratorium on foreclosures, banks in Cyprus announced their intention to resume auctions with a large number of properties in all areas of the island, including apartments, houses, land and commercial real estate.

Those wishing to buy real estate in Cyprus, the cost of which varies from several thousand to several million euros, will be able to do so from next week.

It is worth noting that despite the coronavirus pandemic and the law banning some foreclosures, local banks tried to sell 3,728 properties over the past year and a half.

Of these, 21% or 438 objects were sold. At the same time, 92 units or 2.46% of the total sales fell on houses and apartments in Cyprus, and 97.54% or 391 units fell on fields and land.

Due to the coronavirus pandemic, most of the auctions were conducted online. By the way, since December 2019, an official online platform for buying real estate at auctions has been successfully operating in the Republic of Cyprus.

The overwhelming majority of bidders were locals, who took advantage of various government support programs. Many of them bought houses on credit under an interest rate subsidy scheme.

As you may know, the scheme covers housing loans to individuals in Cyprus, the agreement for which was concluded from March 1, 2020 to June 30, 2021. The program can be used by those whose mortgage rate does not exceed 2.3%, and the loan size is up to 300 thousand euros. The subsidy is valid for 4 years and covers up to 1.5% of the rate. The plan is designed specifically for the purchase or construction of a primary home, including the purchase of a plot.

Thus, Cypriots have become the driving force behind online property sales in Cyprus. 95% of sales fell on local residents - young couples with accumulated money or creditworthy families.

As it turned out, this category is attracted by the simplicity and convenience that such platforms offer, as well as their transparency. Online auctions provide bidders with flexibility in terms of time and place. It is easy to log into the site and participate in the auction, which helps the user to save time and money. Bidders do not need to be physically present at the auctions to take a digital tour of the properties.

The sale of mortgaged real estate is expected to resume next Monday.

There will be 66 properties for sale, which include 7 houses, 5 apartments, 39 fields, 13 land plots, offices and a workshop.

It should be mentioned that the apartments and houses that will be auctioned next week are not the main residence. Local banks still have a policy not to sell the only homes under €350,000. Most of the apartments and houses are rented out by the owners, who thus receive income.

The Central Bank stressed that from 2015 to 2020, only 6 real estate objects were sold, which were the main place of residence of the borrowers. The average cost of these housing units was 525 thousand euros. According to the Central Bank, local financial institutions are now focused more on the sale of small land plots that have ended up in their portfolios as a result of debt repayment of borrowers.

If you are thinking about buying mortgaged real estate in Cyprus, it is worth remembering that the purchase price at the auction is far from the fact that the purchase price at the auction will justify your investment wishes.

In order for the purchase of an object to be really profitable, one should buy real estate even before the real estate is transferred to the bank's balance sheet, since then an additional financial burden will be added to its value. It is really profitable to buy bank real estate until the moment when the bank starts to deal with the sale of property.

You can find profitable options for buying real estate in Cyprus on DOM Real Estate platform. The website also has a large number of rental properties - from residential to commercial real estate. Choose and contact professionals who will help you make the right choice!