Unregulated property management companies are coming under increasing scrutiny in Cyprus, amid mounting claims that some are collecting substantial fees from apartment owners with minimal oversight.
The controversy is intensifying as long-awaited legislation on jointly-owned buildings remains stalled in parliament nearly three years after its submission.
Oversight gaps raise safety concerns
In a recent statement, Interior Minister Konstantinos Ioannou acknowledged serious deficiencies in the current regulatory framework. Responding to the recent deadly building collapse in Limassol, he admitted that existing laws fall short in ensuring proper management and effective enforcement.
With nearly half of the population living in jointly-owned buildings, Ioannou described reform as “an urgent necessity,” warning that continued delays increase risks to both safety and accountability.
Owners challenge management companies’ fees and transparency
Property owners, particularly in tourist developments, have raised concerns over what they describe as loosely regulated “management companies” charging annual common expenses of €1,000 to €1,400 per unit, often without delivering proportional services.
In complexes of more than 100 residential units, such fees can generate between €100,000 and €140,000 annually for a single development. Owners are increasingly questioning whether these funds are properly declared, audited, or managed transparently.
Concerns have also been raised about potential conflicts of interest. Some management firms are believed to be linked to developers, with buyers reportedly required to sign management agreements before they can organise independent committees.
Reform bill delayed amid competing interests
The government’s proposed reform bill, submitted in August 2023, aims to introduce long-needed structure and oversight to the sector. Key provisions include:
- Clearer rights and obligations for owners and tenants
- Mandatory reserve funds for maintenance
- Compulsory insurance for both buildings and individual units
- Enhanced authority for management committees
- A formal system for registration and regulatory oversight
Despite broad recognition of the need for reform, progress has been slow. Ioannou acknowledged that continued delays are exacerbating existing problems, particularly when it comes to unsafe or poorly maintained buildings.
Speaking to Phileleftheros, a representative of property buyers suggested that resistance within parliament may be linked to concerns over potential financial losses for major vested interests.
Meanwhile, District Local Government Organisations (DLGOs) argue that a legal framework already exists but has not been adequately enforced, contributing to a growing number of neglected and potentially dangerous buildings.
Scale of the issue
According to the Department of Lands and Surveys, Cyprus has 20,919 jointly-owned buildings comprising 219,635 residential units. Of these, 14,208 buildings, representing 159,659 units (mainly apartments), are officially registered.
However, a significant portion of the sector remains outside formal oversight: 6,711 buildings, accounting for 59,976 units, are still unregistered, underscoring the scale of the regulatory challenge.
