Cyprus: essential investment tips

There many reasons to invest in a property in Cyprus, but due diligent is always a necessity…

Nigel Howarth, who runs leading Cyprus information portal Cyprus Property Perspective, recently revealed his best investment tips for those thinking of buying property in Cyprus.

Tip 1 - Visit Cyprus

Would you buy a property in the UK without visiting the area? Of course not! Some property developers and overseas marketing companies offer low-cost property inspection trips from the UK.

If you take one of these, you may be given very little free time to carry out independent viewings. Under absolutely no circumstances should you allow yourself to be pressured into buying something without doing some independent research & seeking independent legal advice.

Do your own research, visit the island independently and assess the true situation for yourself.

Tip 2 – Take independent legal advice.

Under no circumstances use a lawyer who’s been introduced or recommended to you by the developer or estate agent. There’s no rush to buy and if the sale falls though because you’ve asked for time, then you’ve had a lucky escape.

Tip 3 - Don’t believe the hype

What looks ideal on some of the overseas property TV channels, may not suit you in the slightest. Many of these programmes get their expenses paid by agents and developers touting for business.

Remember that overseas property magazines rely on advertisers to pay their running costs and salaries. They will therefore paint very rosy pictures of owning investment properties in Cyprus to keep their advertisers happy and the money rolling in.

Tip 4 – Utilise the internet

The Internet is a treasure chest of research material. There are countless Internet forums where you can ask questions of those people who really know about the island, i.e. people who live and own property in Cyprus. And you can find many non-property websites about Cyprus covering local tourism, business, sport, politics etc

Tip 5 - Be clear on what you want from the property

Be aware that buying a property for your own use and buying a property to rent are two totally different things. It’s better to decide before you buy what you want the property for; investment or personal use.

Tip 6 - Put together a realistic budget

Don’t waste your time looking at properties that are well within, or well outside, your actual budget. Have a good idea of local prices; be realistic and add in a contingency of 10% to 15% to cover legal expenses, cost overruns, unexpected problems or extra paperwork.

Tip 7 – make sure you use a legitimate Estate Agent

There are many unregistered estate agents operating illegally in Cyprus, but the authorities seem unwilling or unable to close them down. Although using a member of the Cyprus Real Estate Agents Association isn’t a cast-iron guarantee that you’ll have no problems, they are required to check out the properties they’re selling and they also carry professional indemnity insurance.

A common way for agents to brainwash you is to show you twenty properties in a day. You view one or two nice properties early on, then get dragged around the second-rate ones, and finally with a couple of more attractive properties that look good around sunset. Although it is important to view many properties to get a more informed choice, a good and honest estate agent will have taken on board your specifications and will only show you properties that meet your criteria.

There are also many middlemen dealing in property. These receive a commission or finders fee from the developer or agent when they introduce a client. Property middlemen who receive a commission and who are not directly employed by the developer or estate agent are acting illegally.

Some of these middlemen will insist on taking you to their homes to meet their family and enjoy some of the famous Cypriot hospitality. And will also find many retired Britons acting as property middlemen who prey on the fears (and wallets) of their fellow countrymen.

It makes no difference whether you get conned by a generous and affable Cypriot or a silver-tongued British expatriate, the end result will be exactly the same.

Tip 8 - Size doesn’t matter

Don’t assume that the bigger the company, the better service you’ll get, as the size of a company is no guarantee that it will do a good job. So don’t rule out a company just because it hasn’t got flashy offices, glossy promotional material or fluent English speaking staff. And you will often find that the service you get from companies that target the expatriate market to be generally lower than those that target a wider buying audience.