The government's measures to subsidize mortgages seem to be paying off, as there is an increased search for apartments or houses by young people.
The Plan, which only covers home equity loans and therefore covers the purchase of a first home and the construction of a first home (including part of the loan for the purchase of the plot), mobilized interested parties, who see it as an opportunity to move forward. in the housing market.
It is also a great opportunity for Cypriot investors who were having difficulty borrowing or felt uncertain about repaying their loan, as it covers loans worth up to € 300 000 with a maximum interest rate of 2,3% and will cover up to 1,5% of the interest rate for a period of four years.
In terms of property prices, it is too early to make forecasts, as the support measures that have been implemented do not seem to affect the reduction of prices. However, this is left to the agreement of both parties, seller, and buyer.
Certainly, the pressures on the real estate agents aim to ensure the best possible price, while there is also a search for houses that are in the initial stage of construction or somewhere in the middle with delivery within a few months.
Moreover, the supply of real estate does not seem to have been significantly affected, but the delivery of some projects is likely to be delayed due to the suspension of work due to COVID-19.
The impetus of the government in relation to the development activity is also important.
The government is approving two targeted interventions to support development, by extending urban incentives and granting new facilities to citizens.
In addition to the already approved plans, the Council of Ministers on June 25 approved two new targeted interventions:
1. Plan for the Provision of Urban Incentives. Measures for Legalization and Licensing of Arbitrary / New Constructions in Approved Developments.
The Council of Ministers, in its session of 05/02/2020, approved the extension of the above Plan until 31/12/2021, which has already benefited 1 454 applicants.
2. Plan for the Provision of Urban Incentives for the Purposes of Recovery of the Tourism Industry.
Additionally, the Council of Ministers, in its meeting of 29/04/2020, approved the extension of the above Plan until 31/12/2021, which gives the possibility of maintaining the building factor of an old hotel unit, if it is demolished for the purpose of the construction of a new one.
3. Plan for the Provision of Urban Incentives for the Purposes of Recovery of the Development Activity.
The Ministry of Interior, having evaluated the results of the Urban Incentive Plan and given that from the date of their initial implementation on 29/05/2013 until 30/04/2020, 840 urban applications have been submitted nationwide and 571 were approved and the results are positive in achieving the objectives for which this Plan was implemented, but also due to the data of the coronavirus pandemic, which have had an extremely serious impact on all sectors of the economy, considers that the period of validity of the Incentive Plan will be extended until 31/12/2021.
The new proposal includes an additional regulation that covers the payment of an additional compensatory fee of 5%, in case the applicant fails to submit an application for a building permit within one year, after securing the planning permit. In this way, there is an incentive for faster implementation of the project.
4. Extensions of Planning Permits and Building Permits.
Furthermore, the Ministry of the Interior, having regard to the consequences in the construction sector and consequently in the economy, as a result of the extraordinary restrictive measures taken to deal with the pandemic, considers that the special conditions of this period resemble reasons of force majeure or the existence of special conditions.
For the purpose of adapting the development licensing procedures in conditions of creating a favorable climate for recovery, the Ministry of Interior recommended to the Council of Ministers, which approved it, a proposal for an extension until 31/12/2020 of the planning and building permits that expired time period from 17/03/2020 to 30/06/2020.
The requirement for citizens to provide evidence is abolished
Also, in the context of the government's policy to abolish the requirement for citizens to provide evidence of that information that is already in the possession of public services, the Ministry of Interior announces that from July 13:
- The obligation of the citizens to attach to the applications submitted to the various Departments of the Ministry of Interior (eg Land Registry, Urban Planning, District Administrations) a copy of title deed or real estate research certificate is abolished.
- Also, in the case of applications for real estate development, the submission of an official copy of the real estate plan will not be required.
In addition, where the submission of an official land plan is required today, issued by the Department of Lands and Surveys, this is now replaced by an informal plan that can be printed from the DLS Portal of the Land Registry.
All this, I believe, strengthens both the growth and the demand of the real estate market, while by the end of the year, the first signs of economic recovery, in general, are expected.