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Settling in Cyprus:

Settling in Cyprus

Overcoming the Economic Crisis

For many British expats in Cyprus, or those still contemplating a move to the island, the dream of settling into a new-build home has been a powerful draw. For most of the first decade of the 21st century, the Cyprus property market was healthy, with a particular focus on selling homes to UK citizens. This was a vital sector of the economy, contributing to an overall picture of health, with the construction industry alone contributing 8% of Cyprus’s GDP in 2011. In the years leading up to the international banking crisis, property prices continued to rise, although since then the industry has felt the cold winds of recession with decreased sales and plummeting prices. However, this opened up the market to investors who were able to take advantage of the slump to accumulate a good property portfolio with an exceptionally low initial outlay in the hope of profiting in the long run from the inevitable recovery.

Decline and recovery

After the slump in the UK economy, the property market in Cyprus became more reliant on Russian investors, who now make up 38% of foreign buyers, although the British sector still accounts for 47% of the total. Many British expats with plans to build property in Cyprus had their fingers burnt after the financial clampdown enforced as part of the bailout process imposed by Eurozone finance ministers. Many people with deposits in the Cyprus Bank and Laiki Bank found that they had lost any savings above €100,000 as part of Cyprus’s contribution to the bailout deal. Nobody was allowed to take more than €1,000 out of the country and daily withdrawals from cash machined were restricted to €300. This was a necessary discipline. In a speech at the ECON Committee Hearing on the Troika Report in January 2014, European Vice-President Mr Olli Rehn described some indications of recovery in the European economy that gave an encouraging picture for the coming year, and the importance of the European bailout strategy that has ‘followed the approach of extending solidarity in return for solidity.’ Financial support from the EU alongside harsh local austerity measures seems to have averted total economic collapse.

Changes in the property market, with a fall in sales to Cypriots but a growth in sales to foreign buyers has prompted forecasts of a general improvement during 2014. For many, this has been a long waiting game. During the property boom of the first decade of this century, new villas seemed to be springing up all over the island; it was almost as if you could wake up each morning, look out of the window and find that a new batch had altered the view. This couldn’t last, and when the bubble burst many people became mired in legal arguments over land ownership or planning infringements, which could make the obtaining of a title deed a matter of many years of argument and heartache.

The aim of the 2011 Town Planning Amnesty was to stimulate movement towards a resolution of the crisis, where it was estimated that around 130,000 properties were subject to these sorts of delay. House owners were allowed to legitimise a range of minor planning infringements by a fine only if no third parties were affected, if violations of statutory building ratios were exceeded by no more than 30%, or state property was not encroached upon. In cases of excessive flouting of the regulations, owners were prevented from profiting from the sale of the property, their only recourse being to make a bequest in their will. In 2012 the amnesty was extended for another year, and it has now been extended until 30 April 2014.

New incentives

In Cyprus, the tax advantages, excellent heathcare services, quality of life and low crime rate continue to attract property buyers from overseas. The ease in obtaining a residency permit and the incentives designed to encourage investment by overseas buyers stimulate interest from outside the EU. These include eligibility for an immigration permit if the value of the property exceeds €300,000, which is equivalent to a residency permit to EU citizens. These incentives are designed to stimulate the economy: each property buyer is required to have a secured income earned outside Cyprus of at least €9,568 plus an extra €4,613 for each dependent. Cuts to VAT on new homes from 17% to 5% made in 2011 have been extended to cover the purchase of second homes by buyers from outside the EU. The abolition of property transfer fees in the same year has been extended until 31 December 2014.

Alongside growing confidence in the recovering global economy and a Cyprus housing market already set to improve over the next year, the news on mortgages is encouraging. During the property boom, many British property buyers applied for Swiss franc mortgages in order to take advantage of that currency’s stability and low interest rates. The financial crisis ended that particular dream, increasing the Swiss franc’s value relative to the pound, so that property values fell by as much as 50% while mortgage repayments soared. Consequently, under the 2012 New Limitation of Actions Law, British investors were given until only 31 December 2013 to file claims against developers and lenders. The good news is that this deadline has now been suspended, with a review unlikely before December 2014. Mortgages are now available at a loan to value ratio (LTV) of up to 75%, compared to 80% before the 2012 financial crisis. Choosing a lender always requires careful research into the various mortgage options, and this is certainly true in the current economic climate, despite the various indications of a recovery.

The Cyprus government has also begun a review of the island’s system of property taxes with a view towards consolidation and simplification. The Cyprus Land and Building Development Association’s recommendations for change include a system whereby property owners would be taxed after signing the contract of sale, rather than after the title deeds are issued. This would mean that the buyer rather than the developer would be taxed, which should further stimulate the building sector. Another recommendation to give a 10% discount on tax payments made on time, and a further 5% discount for electronic payments, should speed the process.

Increased investment opportunities have come with the recent signing of an agreement between the UK and Cyprus governments that lifts restrictions on the development by Cyprus residents of private property within the UK Sovereign Base Areas at Dhekelia and Akrotiri. Cypriots were previously unable to make changes to any property owned within these areas. Under the new agreement, Cypriots and UK citizens have the same property development rights, subject to certain safeguards protecting the UK’s military interests. The agreement covers an area of about 198 square miles, or 78% of the base areas, overturning the 1960 Treaty of Establishment that restricted the land to agricultural use only. Most of the affected communities welcomed the move, although there has been some scepticism about whether residents would be allowed a free hand in developing their property. However, President Anastasiades welcomed the agreement as a ‘prompt and decisive’ move in helping Cyprus to recover from the financial crisis.


Settling in Cyprus, Larnaca, Paphos, Limassol, Ayia Napa, Protaras

Immigration permits for non-EU nationals

Scales of Justice

The Interior Ministry recently announced changes to the procedures for granting Immigration Permits (Permanent Residence) to third country (non-EU) nationals who intend to invest in Cyprus. Immigration permits for non-EU nationals

THE Ministry of Interior or the Republic of Cyprus issued an Announcement on May 7, 2013 that Immigration Permits (Permanent Residence) will be issued to third country nationals under the following terms:

1. Investment/Financial Criteria:

(a) The applicant shall submit a statement from a Cyprus financial institution showing that an amount of at least €30,000 has been deposited in a reserve account, for a period of at least three years. This amount must show that it was transferred from abroad.

(b) The applicant and spouse are able to demonstrate that they have at their disposal a secured annual income of at least €30,000 increased by €5,000 for each dependent (including the spouse). This income may come from wages, work, pensions, share dividends, fixed deposits, rents etc. from abroad.

(c) The applicant shall submit with the application a title deed or purchase contract in its and/or its spouse name, filed at the Department of Lands and Surveys, for a residential or other building, of a market value of at least €300,000 (excluding VAT) and official proof of payment of at least €200,000 (excluding VAT), regardless of the delivery date of the house. Provided that the remaining value of the house will be paid from foreign funds into an account at a financial institution in Cyprus.

In case of a couple, this condition will apply for both of them, in the sense that the couple will not be allowed to acquire more than two units totally.

The above amounts should be shown to originate from abroad.

Note that the house purchase will be accepted even when made in the name of the Company and not in the name of the applicant, provided that the Company is registered in the name of the applicant and/or the name of applicant and his spouse and he/they are the sole shareholders.

Provided that if the shareholder is another legal person, it should be demonstrated that the sole shareholder of such legal person is the applicant and/or applicant and spouse.

(d) For purposes of this policy, the applicant may buy up to two housing units (apartments or houses), or a housing unit and a store with an area of 100 sq.m., or a housing unit and an office with an area of 250 sq.m., given that the total market value meets the provisions of paragraph (c) above.

The said sale must be for unit(s) sold by a development company to a buyer for the first time. From 07.05.2013, for the purposes of this policy, applications concerning resales of homes will not be accepted.

Note that purchase agreement documents for home resales deposited in the Land Registry before 7.5.2013 (date of deposit of purchase agreement will be confirmed by the Lands and Surveys Department) will be accepted for purposes of this policy.

Provided that the houses/apartments can be independent of each other, but both must be sold by the same company.

(e) Immigration permits are issued to the applicant with dependents the spouse and children under the age of 18. Unmarried dependent children aged 18 to 25 years, may submit their own separated application for acquisition of immigration permit only if they are proven students and the father and/or mother present additional annual income of €5,000 for each dependent child. Note that each such dependent child shall submit with the application all required documents specified in the list (see section 6 hereinafter).

Provided that such authorization will be valid until the age of 25 years. If the interested person wishes to obtain a new immigration permit, it must apply under the existing criteria as an independent person.

(f) Immigration permit may be issued to the applicant’s children over 18 years of age not financially dependent on the applicant, provided that for each of these children there is attributable market value of the acquired property of at least €300,000 (excluding VAT) as described in paragraph (c) above (i.e. if the applicant has a financially independent child aged 30 and wishes to obtain an immigration permit, he should buy a house total market value of €600,000, if he has two adult children, financially independent, must buy home value of €900,000 etc.).

In such cases, a certificate of payment of at least 66% of the market value of the home must be submitted along with the application (i.e. an amount of €400,000 for a home of a residential market value of €600,000) and each child will submit with its application all required documents (i.e. secured annual income of €30,000, deposit in a financial institution in Cyprus of an amount of €30,000 which will remain blocked for three years).

2. Quality Criteria:

(a) The applicant and spouse must submit a certificate of clear criminal record from the country of resident and generally must not constitute in any way a threat to public order or public safety.

(b) The applicant and spouse will attest that they will not be employed in any direct or indirect way in Cyprus.

Note that the applicant and/or spouse may be shareholder(s) in a company registered in Cyprus and the income from the dividends of such company is not considered as an obstacle to obtain the immigration permit.

(c) The applicant and the member of its family included in the immigration permit must be visiting Cyprus at least once every two years.

(d) All required supporting documents, which are attached to the application for immigration permit as well as their translation in Greek or English must be duly certified.

3. Procedure for Submission and Examination of Application

(a) Applications must be submitted directly to the Civil Registry and Migration Department (CRMD) personally or through a representative (relevant phones 22403921 and 22403943) with a non-refundable fee of €500.

(b) Applications submitted in Cyprus, either personally or through a representative, will be submitted in a common dossier. (Each document of the application will be punctured and attached in the dossier and numbered in blue ink from the first to the last page, this being the responsibility of the person submitting the application).

The dossier will include also a registration form for all documents submitted with the application and for any other supplementary documents by or on behalf of the applicant.

(c) The application shall be speedily processed by the CRMD and submitted to the Minister of Interior. For the purpose of this type of immigration permit, an interview with the applicant will take place only in certain cases considered necessary by the Director General of the Ministry of Interior.

(d) The Ministry of Interior will inform the applicant or his representative and the CRMD on the decision of the Minister of Interior.

(e) The holder of an immigration permit should be visiting Cyprus at least once every two years and comply with all the provisions of relevant legislation.

4. Transitional Provisions:

After the publication of this Announcement, any citizen of third country who applied for an immigration permit Category F may, if it wishes, submit to CRMD additional information to demonstrate conformity that the criteria in paragraphs 1-3 of the Announcement are fulfilled, through a new application form so that the review of the application is performed in accordance with the provisions of Regulation 6(2) of the Aliens and Immigration Regulations and based on the above criteria and relative procedure.

5. Time schedule for the issue of immigration permit

If the criteria of this Announcement are met and unless there are reasons relating to either the criminal records of applicant, either on grounds of policy or public security, the application will be considered by the Minister of Interior in a positive way and the immigration permit will be issued.

It is estimated that by applying the procedure described in this Announcement, the examination period of the application from the date of its submission, will not exceed 2 months.

6. Application Forms

Available online the following forms:

  • Application form (M.67).
  • List (check list) of documents submitted with the application (in Greek and English).
  • List (check list) of documents submitted with the application (in Greek and English) for adult children in accordance with paragraph 1(e).
  • Affidavit for the annual income of the applicant, together with other evidence (in Greek and English).
  • Declaration confirming non-employment of applicant in Cyprus (in Greek and English).

7. More info:

Authorized Officer: Ms Panagiota Nathanael – Administrative Officer CRMD
Elena Pieri – Administrative Officer CRMD
Phone: 22804496 / 22804495
Fax: 22804491
Web page Ministry of Interior:

Courtesy Cyprus Property News

Cyprus expats could face prosecution

Cyprus expats could face prosecution because they lack alien registration certificate

THOUSANDS of European expats could face prosecution because they lack alien registration certificates and are unaware that the government has scrapped their ID cards, it emerged this week.
The discovery was made after one British permanent resident tried to replace her stolen Cyprus ID at a citizens’ service centre (CSC) but was told the card she carried since 2000 and its associated ID number were obsolete.
Instead, the Nicosia CSC officer told her she must return to the immigration office to apply for an alien’s registration certificate (ARC) or ‘yellow slip’ in order to access the services their cards provided.
Last year the Interior Ministry withdrew ID cards for non Cypriots who were not permanent residents, pending the introduction of a new biometric ID card.
However, the ministry confirmed the rules apply to all non Cypriots, regardless their marital or residential status, length of stay or the type of ID card, and that biometric cards will not be given to non Cypriots.
The outraged expat, who arrived in 1991, married a Cypriot in 1998 and received her Cyprus ID card in 2000 told the Sunday Mail: “It’s bloody ridiculous. I have been here 20 years. I have jumped through every government hoop imaginable, and to be told I now have to go and get a residents’ permit is ludicrous.”
Without the old ID, she has already run into problems at her local bank, which had continued to identify her by the obsolete number: “My passport and driver’s licence were stolen with my ID, so in the end I had to ask my sister in law, who works at the bank, to vouch for me.”
“What happens now when I want to take my children to the hospital? Do I have to register as an alien when I am already a permanent resident?” She said.
A health ministry official confirmed that anyone who can demonstrate that they are an EU citizen, working and paying social insurance contributions can access government medical care.
He said those who previously had ID cards could register with their passports and social security information, however, the registration is much quicker and simpler for the health ministry with a yellow slip.
Another problem is that the yellow slip is needed to get a driving licence, so driving abroad is now impossible for this expat until she re-registers.
After several weeks of calling, the Sunday Mail eventually tracked down Immigration Services head Anny Shakkali, who said: “We stopped issuing ID cards (to EU citizens) last year. Now all non Cypriots should carry an aliens’ registration certificate. They cannot use their ID cards.”
The change in policy means it is not only permanent residents with foreign passports who now have to face the nightmarish and lengthy bureaucratic process of yellow slip applications. 
EU citizens who were issued the foreigners’ ID cards must also get yellow slips, or face a fine of up to €2,539.
Shakkali claimed it was “impossible” for anyone to live in Cyprus for more than a year without obtaining the aliens registration certificate, despite having referred several cases to the police for prosecution. So how many are in this situation now? 
The ministry does not know, but the total could be substantial: Shakalli acknowledged “tens of thousands” of Europeans had obtained ID cards over the years, although these people were not tracked in and out of Cyprus.
An informal survey of several EU expats by the Sunday Mail also showed several had been here longer than three months without obtaining their slips, and some who were still in possession of their redundant ID cards.
Last year, for example, the Sunday Mail reported the story of British expat Malcolm Jester, who moved to Cyprus in 1993, married a Cypriot and in 1995 began working in a kiosk, without registering: it was only when he was admitted to hospital in 2011 when he had been ‘off the radar’ for 18 years. He was landed with a €4,000 medical bill.
Jester’s story suggests that if you are long term expat with an ID card but no yellow slip, it pays to jump through the hoops before anything goes wrong. 
To do this, you will need to visit the immigration office and provide several completed forms, photographs, a nominal registration fee and your passport. For more information on the process, visit:
Courtesy Cyprus Mail
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First, each member of our team originates from the UK so there are no communication barriers.

Second, each of us has bought property in Cyprus and understands the the processes from first-hand experience. This has enabled us to help many other people buy property in Cyprus with confidence.



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We were met at the Airport in the early hours of the morning and taken to the Apartment that was reserved for us...

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