In mid-November, Cyprus launched two new government schemes aimed at helping young families buy homes and bringing hundreds of empty properties onto the rental market.
In order to encourage owners to participate in the 'Repair and Rent' scheme, the Cypriot Interior Ministry has proposed the introduction of a number of incentives. The ministry has also recently submitted two new bills to parliament for consideration. The first provides for the abolition of income and corporate tax for beneficiaries of the state programme, and the second - defence contributions for 3 years (from 2024 to 2027). Property owners will also benefit from an increase in capital allowances of up to 20%.
According to preliminary calculations, this initiative will cost the budget of the island state in 5.55 million euros, of which 5.25 will be the cost of exempting beneficiaries from income and corporate taxes, and 300 thousand euros - defence contributions.
It should be recalled that the 'Repair and Rent' programme, for which 25 million euros have been allocated, aims to bring 1,000 empty residential units onto the affordable rental market in Cyprus within two years. The programme is open to both natural and legal persons.
The main conditions for receiving cash grants are:
- The property must have been empty for at least one year prior to the deadline of 1 October 2023;
- The property must be at least 15 years old;
- The property consumes less than 200 kWh per year, as evidenced by electricity bills.
The maximum subsidy under this scheme is set at €15,000 for one-bedroom flats, €25,000 for two-bedroom flats and €35,000 for three-bedroom flats. It is important to note that under the terms of this scheme, owners are prohibited from renting their homes to relatives within the first degree of consanguinity. In addition, the property must be legally registered. In the case of joint ownership, all parties must agree to participate in the scheme. Owners are eligible to apply for additional grants from the Ministry of Energy for energy upgrades, provided that the upgrades do not overlap with work under this programme.