More than 700 mortgaged properties were put up for auction in Cyprus

According to the latest information from the Ministry of the Interior, dozens of auctions will be held in Cyprus over the next two months.

A total of 747 properties will go under the hammer, with prices ranging from €200,000 to €2.8 million.

Interestingly, of the 747 mortgaged properties to be sold in Cyprus, 638 (or about 85.5%) have a starting price below 250 thousand euros and 475 (or about 63.5%) have a starting price below 100 thousand euros.

If we look in more detail by city in Cyprus, then:

1. In Nicosia, 282 properties are up for auction, of which 29 are houses and apartments (26 below 250 thousand euros), 59 are plots with buildings, 184 are vacant plots and 10 are commercial buildings (offices, shops, industrial and craft premises).
2. In Limassol, 156 properties are up for auction, of which 33 are houses and apartments (25 valued at less than 250 thousand euros), 27 plots with buildings, 92 vacant plots and 4 commercial buildings.
3. In Larnaca, 127 properties are up for auction, of which 28 are houses and apartments (27 worth less than 250,000 euros), 28 plots of land with buildings, 63 vacant plots of land and 8 commercial buildings.
4. In Paphos, 123 properties are up for auction, including 16 houses and apartments (all worth less than 250,000 euros), 25 plots of land with buildings, 77 empty plots of land and 5 commercial buildings.
5. In the free areas of Famagusta, 59 properties are up for auction, including 14 houses and apartments (12 of which are valued at less than 250,000 euros), 13 plots of land with buildings and 32 empty plots of land.

We would like to remind you that since December 2019, Cyprus has successfully operated an official online platform for the purchase of property in auction.

The properties offered on this platform are mortgaged properties that have been sold in order to repay the obligations of the borrowers to the banking institutions. The auctions offer mortgaged property of various categories, including houses, apartments, agricultural and industrial land, car parks, etc.

The introduction of such a system was one of the requirements of the international trio of Cyprus' creditors (European Commission, European Central Bank and IMF), which provided financial assistance to the Republic during the 2013 crisis. The creation of the online auction system was also supported by Cypriot banking institutions. This is not surprising, as it is another tool for them to reduce the huge amount of unpayable debts of individuals and legal entities. In this way, Cypriot banks will be able to increase the volume of free cash, get rid of non-performing loans and ultimately stabilise the country's banking system.

It is worth noting that auctions are a favourable platform for local financial institutions. On the other hand, there are a number of nuances that potential buyers of mortgaged properties should be aware of before participating in an auction:

1. There is no opportunity to inspect the property before attending the auction.
2. The property being auctioned is often the borrower's primary residence, which is not easily evicted.
3. The presence of all sorts of "pitfalls". For example, overestimating the value of the property.

To make the deal was really profitable, buy real estate should be even before the property is transferred to the balance of the bank, because then to its value will be added additional financial burden. It is really profitable to buy bank property at the stage of "amicable" solution, before the bank starts to deal with the realisation of the property.