- Cyprus Property News Magazine - http://www.news.cyprus-property-buyers.com -

Unscrupulous Developers Need to be Taken to Task

DEPUTIES examining the long delays in the issuing of title deeds to homebuyers appeared to have finally understood the main cause of the problem after Monday’s House Interior Committee meeting. Light was shed on the problem by the director of the Land Registry Department Andreas Christodoulou, who said there were cases of home-buyers who had been waiting to have title deeds issued for seven or eight years.

Our government departments may be bureaucratic, slow and inefficient, but nobody can believe they need so may years to issue title deeds. The problem, as we pointed out in this column two weeks ago, is caused by developers who do not pay off their loans to the banks and thus cannot take ownership of the buildings they have sold.

These properties are legally the ownership of the bank because they had been signed over by the developer as security for loans received. If the loan is not repaid in full, the banks have ownership and no title deeds can be issued.

This was confirmed by Christodoulou at the committee on Monday. He said there were countless such cases and explained that developers were not in a hurry to pay off their bank loan even after they had sold all the properties in a development. Often the money collected was used for another development project, while the bank kept ownership as security and the buyers were kept waiting for their title deeds.

Deputies had hoped that an amendment to the law passed last year would have speeded up the issuing of title deeds but it made no difference, which is why they are grappling with the problem now. No progress was made because the amendment envisaged complex legal procedures against the developer, which very few people were prepared to take. The amendment put no legal pressure whatsoever on the developer to issue title deeds, which is why it never worked and deputies are considering drafting another bill.

News that the UK’s Channel 4 television station is preparing a documentary about this scandalous situation has given deputies fearing the negative publicity a sense of urgency in drafting new legislation. Such a documentary could be disastrous for developers and the construction industry, which has been enjoying an unprecedented boom thanks to the sale of properties to foreigners.

Any new law should target the developers, who should be legally obliged to issue title deeds within a specified time period. Even if a developer has not managed to sell all the properties in a development in time to repay a bank loan, why must the buyer be made to wait for his title deed? When someone has paid for a property, he should be able to enjoy the right to ownership immediately and not when it suits the seller.

This should be the primary concern of the lawmakers when they are drafting the new law, because developers have been allowed to take too many people for a ride for far too long.

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