Property sales to non-Cypriots improve slightly

David Crowther
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ACCORDING to the latest figures from the Cyprus Land Registry 158 contracts of sale were deposited by non-Cypriots at the Land Registries throughout Cyprus in November, compared to 117 in October and 287 in November 2008.

During November, thirty one properties were sold in Nicosia and Larnaca, twenty five in Famagusta, thirty five in Limassol, and thirty six in Paphos.

This year looks like being a disaster for Cyprus’ overseas property market. The hype surrounding the Island’s decision to join the European Union and its subsequent accession helped it achieve record sales to foreign buyers of 11,281 in 2007, more than five times the current forecast for this year.

Cyprus Property Sales to Foreign Buyers – 2008/2009 Comparison
Location Nicosia Famagusta Larnaca Limassol Paphos Total
Month 2008 2009 2008 2009 2008 2009 2008 2009 2008 2009 2008 2009
January 29 8 68 12 142 26 63 34 189 51 491 131
February 61 15 107 18 147 28 83 41 246 58 644 160
March 45 6 110 16 157 17 114 25 198 41 624 105
April 36 13 140 20 171 18 99 36 207 35 653 122
May 44 19 157 12 171 23 109 31 246 43 727 128
June 25 15 170 52 178 29 140 40 196 65 709 201
July 43 37 167 30 156 41 122 52 216 90 704 250
August 19 10 94 4 140 29 76 20 167 30 496 93
September 28 28 79 26 139 23 104 36 224 60 574 173
October 26 22 108 16 105 19 83 27 174 33 496 117
November 22 31 34 25 48 31 57 35 126 36 287 158
Total Sales 378 204 1234 231 1554 284 1050 377 2189 542 6405 1638
% Change -46% -81% -82% -64% -75% -74%

Property Sales to Non-Cypriots (Source: Cyprus Land Registry)

Buyers from the UK make up around half of the foreigners buying property. But the economic situation at home, the Sterling/Euro exchange rate and numerous media reports about the problems with developers’ mortgages and Title Deeds have deterred many of them from buying property on the island.

At the present time Cyprus is littered with thousands of unsold holiday homes, apartments and houses. Many part-completed developments, particularly those in the once popular tourist areas, have been mothballed because no-one is buying.

The collapse of the market helped to push Cyprus into recession earlier in the year; a situation that is proving to be a major headache for the Government’s finances and the island’s economy.

Cyprus property sales: December 2009 report

Nigel Howarth
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ACCORDING to the latest figures from the Cyprus Land Registry, there was a modest increase in the number of properties sold during November this year compared to November 2008.

Overall, 792 contracts of sale were deposited at Land Registries throughout Cyprus in November, compared to 723 last month and 782 in November 2008. And although 1% more properties were sold last month than a year ago, demand is still very low compared to previous years. In November 2007 for example 1,979 properties were sold and in November 2006 1,587.

Number of Property Sales – 2008/2009 Comparison
 Location Nicosia Famagusta Larnaca Limassol Paphos Total
 Month 2008 2009 2008 2009 2008 2009 2008 2009 2008 2009 2008 2009
 January 367 101 187 37 345 77 301 152 415 91 1615 458
 February 349 161 269 52 312 112 345 132 306 101 1581 558
 March 365 162 142 49 229 97 317 160 273 112 1326 580
 April 296 162 143 71 296 122 310 126 291 122 1336 603
 May 325 184 216 68 282 134 268 146 275 107 1366 639
 June 298 188 166 82 289 152 297 189 336 142 1386 753
 July 330 254 225 114 266 141 369 214 352 179 1542 902
 August 155 173 128 64 165 135 236 148 252 122 936 642
 September 238 235 196 83 241 113 233 174 249 152 1157 757
 October 228 195 128 88 211 114 235 182 214 144 1016 723
 November 178 221 82 92 128 134 197 191 197 154 782 792
 Total Sales 3129 2036 1882 800 2764 1331 3108 1814 3160 1426 14043 7407
 % Change -35% -57% -52% -42% -55% -47%

Property Sales to Cypriots & Foreigners (Source: Cyprus Land Registry)

Some believe that this ‘reheating’ is attributable to price reductions on overseas holiday homes being offered by some of the property developers who target that segment of the market, while others believe it is due to Cypriots taking advantage of price reductions.

Chartered surveyor, valuer and real estate agent, Antonis Loizou believes that that the slight increase is due to Cypriots snapping up cheap deals and that a further improvement will occur in mid 2010 followed by a recovery in 2011.

However, real estate agent Elias Danos said “The increase in sales is occasional and the market will recover after summer”.

Those in the property industry believe that the recovery will take a long time and that it will not return to the heady days of 2007 – even after the market has recovered.

Chairman of the Land and Building Developers Association, Lakis Tofarides is more pessimistic, saying that sales in the past few months are like “a drop in the ocean”.

“There are thousands of unsold flats and houses. The sale of 100 – 200 properties does not change the situation, given that there were many big developers who sold 10 – 15 properties per week and now they sell 10 per year”, he said.

(In a statement released earlier today by Dolphin Capital Investors, the total gross sales booked by Aristo Developers (‘Aristo’) in September, October and November were €11.6 million, an increase of 25% over the same period last year).

Limassol marina weighs anchor

Editorial
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PETROS Clerides, Cyprus’ Attorney General, gave its consent on Tuesday for the submission of the proposal for the construction of the Limassol marina to the Council of Minister this or next week.

In his statements to StockWatch, Commerce Ministry General Manager, Efstathios Hamboullas said that all obstacles have been overcome and the proposal for the marina is already on the Council of Minister’s agenda. As soon as it is approved, the contracts will be signed and works will start immediately.

A representative of Lemesos Marina Ltd, which undertook the projects with the Build-Operate-Transfer (B.O.T) method, said that the finance of the project has been secured but it will take three months until the funds are released.

He believes that the construction of the project will be finalized in three years, while it is the first big marina of Cyprus with a capacity of 1,000 vessels. It will offer a range of services including dining, residential, shopping and conference space. A green park will surround the marina, while all buildings within it will adhere to old Limassol’s traditional architecture standards.

Limassol Marina Ltd comprises J&P Avax A.E., Cybarco PLC, Fraggoudi & Stefanou, Ioannou & Paraskevaidi, Athena ATE, Cads, Holding Ltd and the Limassol Chamber of Commerce and Industry (EBEL) through the Limassol Marina Development Company.

The total cost of the project is expected to reach €350 million.

swc

Cyprus property dealer murdered

Anna Hassapi
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A 61-YEAR-OLD Russian multi-millionaire, a permanent resident of Limassol, was found strangled and hastily covered up with tree branches on an Ayios Tychonas beach early yesterday morning.

While investigators were initially reluctant to confirm that the man – named last night as multi-millionaire property dealer Yuri Kyrilov – was murdered, a post-mortem later showed the victim had been strangled to death, following a struggle with his attacker.

“The man was strangled by someone using his hands. The body has several injuries, which could be signs that a struggle preceded death,” confirmed pathologist Nicolas Charalambous who performed the post mortem.

The fact that Kyrilov’s body was found covered by tree branches was the initial indication that he was murdered, police said. “We are concerned by the fact that the body was half-covered by tree branches. Apparently, someone covered the body after he died,” said Deputy Chief of Operations Andreas Krokos.

The body was discovered by a resident of a nearby building in the early morning. The resident thought the tree branches looked suspicious from his balcony and approached the spot next to the seafront walkway where the body lay. He then alerted the police.

Kyrilov’s body was found face down inside a ditch next to the popular walkway. The post-mortem determined the 61-year-old had died 10 to 12 hours prior to his body being discovered. The murder therefore took place on Sunday evening. Despite evidence of what could have been an extended fight at the scene, it has not been verified whether the man was killed at the beach or somewhere else before being dumped there. However, police have confirmed that the victim owned a beachside apartment just a few hundred metres from the spot where his body was discovered.

Police investigators found personal items carried by the victim, including a very expensive watch, €50 in cash, some pills, his keys and mobile phone. Next to the body, police found a large syringe usually containing a veterinary anaesthetic, as well as a needle. Police, however, have not yet confirmed if the syringe had been used by the victim, or by his attacker.

“We have traced several pieces of evidence, including a syringe. We cannot say, however, if it had been used by the deceased or by any other person. It may have been there from before,” said Krokos.

Meanwhile, police investigators have contacted Kyrilov’s son, who also resides in Limassol. The man’s statement to police is expected to shed some light on the case, which at present remains a mystery.

cmc

Property buyers rights to be strengthened by new law

Charles Charalambous
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CONSULTATION on the draft legislation designed to ease the Title Deeds problem and ultimately create healthier conditions in the property market has now been completed “within an open, democratic and transparent process” aimed at creating the “broadest possible political and social consensus”, Interior Minister Neoclis Sylikiotis said on Friday.

“For the first time and in a holistic manner faces up to a lingering problem, a Gordian Knot which has prevented thousands of Cypriot and foreign property buyers from obtaining Title Deeds,” Sylikiotis said.

The Minister spoke to the press after meeting with representatives of the main political parties last Friday to discuss the draft legislation package. He said the aim was to facilitate the bills’ speedy passage through the House in early 2010 following their approval by the Council of Ministers before the end of the year.

An estimated 130,000 units (houses, flats, hotels) are currently without Title Deeds, while only 22,000 applications for Title Deeds have reached the Land Registry, with a further 4,000-5,000 being processed in recent months. The proposed legislation has been designed to ease this bottle-neck by providing an “amnesty” for minor infractions of town-planning regulations and strengthening the position of property buyers when applying for Title Deeds.

The consultation process began with the publication of the five bills in July. A first round of meetings was held with various interest groups such as the Technical Chamber (ETEK), the Cyprus Chambers of Commerce and Industry (KEVE), the Employers and Industrialists Federation (OEV), the Cyprus Land & Building Developers Association (CLBDA), and official representatives of surveyors, civil engineers and other property sector professionals.

This first round of consultation meetings produced written proposals for improving the bills. The second round took place over the last two days, when Sylikiotis briefed all interested parties – this time including the Cyprus Land and Property Owners’ Association (KSIA) and the Cyprus Property Action Group (CPAG) – on what will most likely form the final version of the draft legislation.

The Minister emphasised once again yesterday that “strengthening the buyer’s rights lies at the centre of the amendments”. One set of new provisions will make it compulsory for the sale & purchase contract to be registered with the Land Registry, and for the Completion Certificate to be applied for and obtained by the developer. In practice, the lack of compulsion on such matters has acted against property-buyers’ interests.

Sylikiotis said that this new process will bring the problems to the surface, and forcing them through the system will facilitate the issuing of Title Deeds.

© Cyprus Mail 2009

Situation is critical says Cyprus Central Bank governor

David Crowther
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SPEAKING in Parliament, Athanasios Orphanides said that the Cyprus economy is expected to contract by more than 1% this year and budget deficit levels to double the designated Eurozone 3% mark by 2011.

Mr Orphanides said that the Cyprus Central Bank projections reflected the deep-rooted structural problems in the Cypriot economy.

“The situation is critical, and the state budget must reflect the reforms required for fiscal consolidation,” he said.

Cyprus fell into recession this year, with statistics last week showing that the economy contracted by 1.4% during the third quarter of this year.

The island lagged behind its Eurozone peers in showing signs of strain from the global economic turmoil. Tourism arrivals and revenue, a mainstay of the economy, have plunged by more than 12%.

Public coffers have also been sapped by a collapse of another mainstay of the economy; the overseas property market. The property sector saw Cyprus return growth rates of more than 3% in recent years, and surpluses in 2007 and 2008.

Orphanides said cuts in public sector spending, which make up a third of the €7.85 billion budget, would be a good start to prevent a “critical situation” from deteriorating.

“The sooner necessary structural changes are done to put public finances in order, the smaller the cost will be and the quicker we’ll succeed in achieving sustainable development and prosperity,” he said.

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