Two million visitors and counting

TWO MILLION visitors have now visited Cyprus Property News since the site was re-vamped a couple of years ago; that’s more than double the Island’s population.

The landmark number was reached around 10:30 this morning, Cyprus time.

Over the years we have reported on the rise and fall of the Island’s property market and published property-related articles and items of news that we hope you find interesting and informative.

In recent times, much of the news has been very negative. The continuing Title Deed fiasco, high prices, problems with the economy, record levels of unemployment, lack of liquidity and the general uncertainly about what the future holds have resulted in a dramatic downturn in sales.

Although the government introduced yet another amnesty planning last year, replaced the old Specific Performance law in efforts to improve investor confidence, reduced Property Transfer Fees – the local equivalent of the UK’s Stamp Duty Land Tax (SDLT) – sales remain at numbers last seen a decade ago, before the property boom.

Clearly the Cyprus government has to do much more to restore investor confidence and encourage the property market. Title Deeds must be available for transfer on delivery of a property like most other civilised countries.

Proper enforcement of the law is another critical issue. Illegal construction works have to be stopped. This would remove the need for any planning amnesties, which in any case do not appear to be very effective.

But to close on a lighter note and to celebrate our two millionth visitor, the video below is a 1964 comedy film lasting 40 minutes. It shows a brick-by-brick account of the building of a young couple’s dream home from the day they sign the contract to the day, several years and children later, when they finally move in.

The story is a wordless comedy of errors as incompetent builders struggle to complete their house.

Any similarity to person or persons living or dead is purely coincidental. But I am sure that many will see something in the film reminding you of your experiences when buying a new home in Cyprus.

[youtube=www.youtube.com/watch?v=osj1rXISQiA&rel=0&w=470&showinfo=0]

Government approves first ever land swap deal

FOR THE first time ever, the government has approved the exchange of property between Greek Cypriot and Turkish Cypriot owners north and south of the island in what Attorney-general Petros Clerides was at pains to stress yesterday is a “special” one-off case.

Despite his claims, the government’s decision to transfer ownership of Turkish Cypriot property in Larnaca to Greek Cypriot refugee Dr Mike Tymvios and then purchase the land from Tymvios will have pricked up the ears of the Turkish Cypriot leadership which has long argued for a comprehensive property settlement based on exchange.

Clerides yesterday confirmed a report in daily Politis that the cabinet has approved the exchange of land between a Turkish Cypriot refugee and Tymvios, five years after the Greek Cypriot had reached a friendly agreement with Turkey over his occupied property.

In 2003, the European Court of Human Rights (ECHR) ruled in favour of Tymvios, finding Turkey guilty of violating his human rights.

Four years later, after applying to the Immovable Property Commission (IPC) in the north, Tymvios reached an amicable settlement with Turkey, agreeing to exchange approximately 600 donums of land near Tymbou in the north for 27 donums of Turkish Cypriot land in Larnaca.

(A donum is 14,400 square feet – 1,338 square metres).

However, the friendly settlement proved a headache for the government as the land in question now had two schools sitting on it and a number of businesses.

The Land Registry in Larnaca, on the advice of the Attorney-general, refused to allow the transfer of Title Deeds to Tymvios.

The Greek Cypriot refugee filed two lawsuits at the Larnaca District Court against Cyprus for failing to approve the transfer, while seeking €1 million in rent for each year they delay the transfer.

His case was further strengthened in 2008 when the ECHR endorsed the friendly settlement between Tymvios and Turkey, finding that the outcome did not violate his human rights in any way.

Since that endorsement, the Council of Europe’s Committee of Ministers (CoM) has been responsible for monitoring the implementation of the decision.

In 2010, Tymvios said he would take the government all the way to the ECHR to defeat the law on the Guardianship of Turkish Cypriot properties which was preventing him from seeing the deal through.

Legal experts have long warned that the guardianship law, put together to handle Turkish Cypriot properties in the government-controlled areas, was full of holes that could easily be picked apart if ever examined closely by the Strasbourg court.

Clerides yesterday confirmed that on his advice, the guardian of Turkish Cypriot properties, Interior Minister Eleni Mavrou proposed to cabinet that the transfer be approved and that the land be bought off Tymvios for €13 million.

He argued that the two proposals, approved by cabinet, were in the public interest and would “in no way open the door to the exchange of properties” between north and south.

“The value of the land is much greater than what was agreed, the land’s value was calculated at 21 million Euros,” he said, noting that two public schools were on the land.

The €13 million would be paid to Tymvios in four instalments.

He proposed a private land sale with Tymvios as expropriation would have tied the state’s hands over what it could do with the property in the future.

The AG highlighted that this was a “special” case since the friendly settlement had the “blessing” of the ECHR and its implementation was being monitored by the Council of Europe’s Committee of Ministers.

And after five years, the hearings for the lawsuits against Cyprus were finally about to start.

Clerides argued that following the Demopolous case at the ECHR which pulled the plug on all Greek Cypriot property applications to the ECHR, forcing them to go via the IPC in the north first, there won’t be another case like this one.

“No road has opened for exchanges, the road to the ECHR has closed with the Demopoulos case,” said Clerides, adding, “this does not create a precedent”.

However, the AG appeared to dismiss the possibility of another challenge in the local courts going all the way to Strasbourg if and when the Land Registry refuses to approve the next exchange of property agreed at the IPC between a Greek Cypriot and Turkish Cypriot owner.

Human rights lawyer Achilleas Demetriades told the Cyprus Mail yesterday that the result was to be expected, since the friendly agreement had the “seal of approval” of the ECHR.

“The interesting thing is this type of settlement confirms that the transfer of property by the Turkish Cypriots to Mr Tymvios is allowed, and that’s why the government is buying the land off him.

“More importantly it signifies the start of a new approach, namely that exchange, in fact facilitated by the IPC, is not out of the question,” said Demetriades.

He noted that the government would have to explain why it opposes a similar case of exchange in the future seeing as it has already approved it once.

Tymvios yesterday refused to comment on the case.

Construction production index plummets

construction production plummets
The Production Index in Construction for the first quarter of 2012 dropped to 71.0 units, a fall of 16.5 percent compared with the first quarter of 2011, and it is shrinking at the highest rate since records began according to figures released by the Cyprus Statistical Service (CYSTAT) earlier today.

During the fourth quarter of 2011 the Index dropped 12.4%, while over the whole of 2011 the drop did not exceed 9.4%.

Comparing the first quarter of 2012 to the first quarter of 2011, the Production Index for Buildings fell by 11.3% and the Production Index for Civil Engineering fell by 30.6%.

The Output Prices Index in Construction for the first quarter of 2012 dropped half of one percent to 112.1 units compared with the fourth quarter of 2011. Compared to the first quarter of 2011, the index rose by 0.1%.

Comparing the first quarter of 2012 to the first quarter of 2011, the Output Prices Index for Buildings fell by 1.9%, while the Output Prices Index for Civil Engineering increased by 8.5%.

The base year for both indexes is 2005 (2005=100).

Cyprus construction sector decline continues

THE NUMBER of building permits issued in April 2012 stood at 500 compared with the 560 issued in April last year; a decrease of 10.7%, according to the latest figures released by the Cyprus Statistical Service.

Compared with April 2011 the total area of these building permits fell from 174,749 square metres to 106,275 square metres, a drop of 39.2% and their value fell from €157 million to €106 million, a drop of 32.5%.

During April, building permits were issued for:

  • Residential buildings – 347 permits
  • Non-residential buildings – 77 permits
  • Civil engineering projects – 38 permits
  • Division of plots of land – 37 permits
  • Road construction – 1 permit

During the first four months of 2012 a total of 2,496 building permits were issued, a decrease of 5.3% compared with the first four months of 2011. The total value of these permits fell 30.8% and their total area fell by 35.6%.

New home construction

In April, 347 permits were approved provided for the construction of 373 new homes comprising 251 single houses and 122 multiple housing units (such as apartments and other residential complexes).

This is a fall of 39.0% compared with April 2011 when building permits were issued for the construction of 1,196 new homes.

Cyprus new home construction April 2012
Source: Cyprus Statistical Service

During the first four months of 2012, the number of new homes for which permits have been issued has dropped 44.1% compared with the same period last year.

According to the Cyprus Statistical Service, building permits constitute a leading indicator of future activity in the construction sector.

Real estate sales falter in June

DURING June, a total of 543 contracts for the purchase of properties were deposited at Land Registry offices across the island compared with the 589 contracts deposited in June 2011; a fall of 8%.

Of those 543 contracts, which include the purchase of residential properties, commercial properties and land, 108 (20%) were in favour of overseas buyers and 435 (80%) were in favour of Cypriot buyers.

The hope that the surge in last month’s sales heralded the start of recovery has evaporated. It would appear that this was due to a rush to beat the deadline to benefit from the 6-month reduction in Property Transfer Fees introduced by the government last year. (The deadline has now been extended to the end of the year).

At the end of the first half of the year, total sales stood at 3,710 – up by 4% on the 3,577 sold during the first half of 2011. The increased number of sales during January and June would indicate that the temporary reduction in Property Transfer Fees had a transient but positive effect on the market.

Domestic sales

Overall 15 more properties were sold during June, an increase of 4% compared with June 2011. This was mainly due to an additional 38 properties sold in Larnaca; an increase of 97% – and an additional 61 were sold in Paphos; an increase of 94% compared with the June 2011 figures. One further property was sold in Famagusta compared with last year, representing a rise of 3%.

However, on the downside, sales in Limassol fell by 65 and those in Nicosia fell by 20 compared with June last year.

During the first half of 2012, domestic sales stood at 2,910 – an increase of 12% on the 2,601 sales in the first half of 2011.

Cyprus property sales (domestic) June 2012
Source: Department of Lands and Surveys

Overseas sales

The overseas market remains fragile and continues to weaken. The number of sales dropped in all areas during June, falling by 61 (36%) compared with the number sold in June 2011.

The area hardest hit was Larnaca, where sales were down 26 (-68%) compared with June last year. Larnaca was followed by Paphos -13 (-33%), Limassol -10 (-26%), Nicosia -7 (-26%) and finally Famagusta -5 (-26%).

During the first half of 2012, overseas sales stood at 800 – a decrease of 18% on the 976 sales in the first half of 2011.

Cyprus property sales (overseas) June 2012
Source: Department of Lands and Surveys

MEP slams Cyprus

During President Christofias’ speech to the European Parliament on Wednesday, British MEP Graham Watson slammed Cyprus over its crooked lawyers and property developers.

“Lead by example in Europe’s fight against crime” he said “intervene against the intricate intrigue of corrupt Cypriot lawyers and property developers who rob holiday homebuyers of their retirement savings.”

[youtube=www.youtube.com/watch?v=x6YjRFoX9gE&rel=0&w=470&showinfo=0]

Free Tickets to A Place In the Sun Live

A Place in the Sun
Amanda Lamb, Jonnie Irwin and Jasmine Harman (photo: A Place in the Sun)

DECIDING on the ideal home abroad is a major decision, particularly in the current climate, and with so much choice on offer it’s important to do your research to make sure you get exactly what you want.

Every spring and every autumn, A Place in the Sun Live features thousands of overseas properties for sale, by hundreds of exhibitors from more than 40 countries worldwide. And with homes from less than £20,000 to over £1 million, there really is something to suit almost every taste – and budget.

The next A Place in the Sun Live overseas property exhibition takes place at NEC Birmingham between 28th – 30th September 2012 and we already have an impressive list of exhibitors booking stands at the show.

There will be a packed schedule of free-to-attend seminar sessions in dedicated theatres giving advice on buying property in France, Florida, Italy and Portugal.

Then there’s the Buying Advice Seminar Theatre which will play host to sessions on buying property in Spain, Cyprus, Turkey, plus many other destinations.

And as if that wasn’t enough there’s also a daily session focusing on emigration where you can learn everything you need to know if you’re thinking of leaving the UK for good.

The centrepiece of the show is The Main Stage where Channel 4 TV presenters Amanda Lamb, Jasmine Harman and Jonnie Irwin will be appearing over the weekend to give their top tips on buying property overseas.

Get your free ticket to A Place in the Sun Live at the NEC in Birmingham (Tickets usually cost £15 for two when booked in advance or £12 each on the door)