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Overseas property sales in 2011 lowest for ten years

The dramatic collapse of the Cyprus overseas property market, which has left thousands of partly built holiday apartments and villas littering the Island’s seaside towns and villages, continued in 2011 with sales falling to a 10 year low.

FIGURES released by the Department of Lands and Surveys earlier today show the extent of the crisis in the Cyprus property industry with overseas sales falling in 2011 to reach levels last experienced a decade ago.

During December, the number of contracts for the sale of property to foreign buyers deposited at Land Registry Offices throughout Cyprus fell 55% to 116 compared with the 258 contracts deposited in December 2010; the largest fall in a single month of 2011.

Sales fell in all areas. In Famagusta, just eight properties were sold to foreigners; a drop of 70% on the twenty seven sold in December last year. Sales in Paphos were down 64%, followed by Limassol (-55%), Nicosia (-36%) and Larnaca (-34%).

Source: Department of Lands and Surveys

Despite some encouraging signs during the first half of 2011 that overseas sales were improving, by the end of the year end the number of contracts deposited had fallen by 19% to 1,652 compared with the 2,030 deposited during 2010.

Lowest numbers for a decade

Overseas sales are at their lowest level since the property market started to take off 2001. At the height of the boom in 2007, 11,281 properties were sold to overseas buyers, but in 2011 that number fell by more than 85% to a mere 1,652.

Source: Department of Lands and Surveys

Readers' comments

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  • martyn benstead says:

    Finally all the prediction of the thousands of ex pats in Cyprus and home owners in general in Cyprus has come true. The government, banks, legal and developers through their greed to con, steal and scam buyers is now affecting Cyprus and the innocent Cypriot people.

    Gavin is right I totally agree as I do with all the comments because we all know its true.

    Home to Roost Cyrus government sort it out before Cyprus is a republic of Russia.

  • Denton Mackrell says:

    @Nigel. OK but wasn’t your happy experience some 30 years ago before all the rot set in?

  • @Gavin – We were wined and dined by a developer in Paphos when we first started looking for somewhere to live – don’t say no to a free lunch (but don’t sign any papers).

    We had a long conversation with the agent as he drove us to Paphos about our plans and he said to us “you are not going to like these houses, but please remember this is my job and you will be given a nice lunch”.

    As we drove back to Limassol he said “you should buy some land and build your own house” and, after some more research, this is what we did a couple of years later.

  • Gavin Jones says:

    Peter (6.52 am).

    Nice try.

    Unfortunately, your inference that there are glimmers of hope in the Cyprus property market cuts no ice. For you to write that you think that “the situation is slowly improving” will be small comfort to the 40,000 non-Cypriots who still don’t have their title deeds. “Improving”? I think not.

    Many of us have had decades of battling with the inherent corruption that permeates this society, in my case a lifetime by virtue of the fact that my mother was Cypriot.

    I don’t have to tell you that any organization which repeatedly suckers its clients is doomed to failure. This analogy applies to Cyprus and believe me, the game’s up.

    The legal profession is a total disgrace with a regulatory body which looks after its own. You write that “most people are aware…of the cowboy lawyers.” You and I might know some of them but how does somebody walking off the plane?

    Let’s now dissect the protagonists in this wretched saga:

    Developers? As a collective body, totally discredited although I’m sure there are reputable ones out there.

    Banks? Enough has been written about them elsewhere. However, I will allude to Alpha Bank’s recent antics.

    Parliament? Majority are lawyers.

    Successive government Ministers? Mostly lawyers – again.

    Need I say more?

    Not for one moment do I question your personal integrity and I don’t doubt that you run an honest, tight ship. However, the dice are weighted too heavily against a prospective purchaser of real estate.

    The fact of the matter is that until the mechanism is in place to transfer title deeds at point of sale, I would advise those alighting on these shores to desist from being wined and dined by developers and their lawyers. They’d be better off building an extension on their existing property back home and renting here: it’ll preserve their health, wealth and sanity. The risks here are simply too great and override any potential upside.

  • Peter says:

    One or two comments. Firstly John Swift wants BS to reduce all their prices by € 100,000, and there are other comments about unrealistic prices. As a general rule most agents are looking to make a quick sale and want to advertise at a realistic price for a property – but generally the price is set by the seller – often with unrealistic ambitions !! Many sellers are limited by their outstanding loans, particularly if Swiss Franc.

    The sales figures do not unfortunately show types of property selling. I would agree with Nigel that there are problems with the large number of apartments blocks that have now spoilt Paphos and mostly bought by Investors looking to make ‘quick’ money, or families ‘persuaded’ to buy when they came here for an Inspection visit. These properties seem to have the biggest problem with Title Deeds and appear to be virtually unsalable, whereas good quality property, in a nice location, at realistic prices, and fully legal are selling well.

    I am a reputable property agent, operating from offices and many satisfied clients. We do not do inspection trips, and all potential buyers are advised of the legal status of any property that they look at, any deposit paid (always to a reputable lawyer), is fully refundable should any problems be found at Land Registry. We are not all crooks – as is sometimes suggested. 

    I agree that there are many problems still to overcome here in Cyprus, but overall, thanks to forums like this, general publicity, and the overall financial crisis – I think the situation is slowly improving. This financial crisis means that only professional developers and agents will remain in business – and most people are now aware of which are the cowboy lawyers – and hopefully nobody will again use a lawyer recommended by a developer. Thanks to the EU, building standards are improving. Cyprus is not perfect – but where is Utopia ? There are forums like this, in every single country where property is sold.

  • Pete says:

    There comes a time when people have had enough either of being ripped off or continually lied to or treated like a cash cow.

    Most people want nothing more than to live their lives in peace and harmony but how are we expected to do that when people like Alpha bank are preparing to turn pensioners out of the homes they bought and paid for quite legally and through no fault of their own?

    As has been mentioned, property exhibitions in the UK will be targeted to inform an unwary public about the practices that happen here and if those exhibitors don’t like it, I suggest they speak to their countrymen and put a stop to all that ails this island. If they don’t, they’re part of the problem.

  • @david – Having lived here for nine years, the cost of living is (in my opinion) still lower than the UK.

    Dairy products and bread are more expensive, but vegetables, meat and fruit cost less. However, some people will only buy brands of food and other products they know from the UK. These are obviously more expensive given the costs involved in their shipping and storage.

    Yes, the fall in the value of Sterling against the Euro means that we do not go out as much as we used to, but you can still get a damn good meze at our local taverna for €10.00.

    I know I’m going to get shot down in flames for saying this – but Cyprus went for quantity rather than quality during the boom years in the property market. This resulted in much of the Island’s natural beauty being buried under millions of tons of little white concrete boxes and nondescript blocks of apartments that blotted the landscape which helped to discouraged ‘quality’ buyers. And you only have to take a walk along Bar Street in Paphos to see what facilities are on offer!

    As it’s the bottom-end of the market that suffers first, it wasn’t surprising what happened when the economy went pear-shaped and news of the Title Deed scams and stories of nefarious lawyers, developers, etc. received wide publicity in the UK.

  • david says:

    Although not owning a property in Cyprus, I had/have a desire to live/retire to Cyprus… BUT!!

    Having holidayed in Cyprus for some 25 years and having followed the Cypriot housing market over the last 10 years. I feel as a Brit still living in the UK I can identify certain basic reasons for not having made the permanent move.

    1) Cyprus joined the Euro. Thus major inflation.
    2) Strength of the Euro v £ Stirling
    3) Inflated property prices which are unrealistic.
    4) Major problem re. Title Deeds/Lawyers etc..
    5) Cost of living in Cyprus is now a concern.
    6) Cyprus is an expensive country compared to other EU countries such as Spain.

    There’s still hope though. The Euro is weakening, but what about all the other reasons.

    Good Luck to all you Cyprus residents caught out in the perfect storm. What goes round, comes round !!

  • @UBoat – you asked why Famagusta came bottom in all of the surveys. One reason is that only a small part of it is in the free areas (most of it is in the occupied areas) and the figures only cover what’s happening in the free areas.

    Looking at the number of sales since 2000, the free area of Famagusta is the second most popular region for overseas buyers behind Paphos.

  • UBoat says:

    @ Nigel
    Whats the Turkish Occupied part of Famagusta got to do with the survey figures?
    Surely these are not even looked at.
    It is still a big Tourist and settlement area for Brits.

    Regards

  • Costas Apacket says:

    Maybe somebody who has actually purchased a Deedless property from B-S could vouch for the fact that everything was done by the rules?

    I venture to suggest that if you called B-S tomorrow and told them you wanted to buy a property, they would trip over themselves in their haste to take a deposit off you.

    I think the lack of Title Deeds for the property would be discussed at some point, but I doubt very much if the Certificate of Final Approval would be discussed unless you mentioned it to them.

    I would also suggest that any purchaser of such a property would only find out about any existing encumbrances when they tried to obtain their Title Deeds or presented a completed N50 form to their District Lands Office, not to mention any further encumbrances which may be taken out after they had paid in full for their property.

    Why not try it and see? ;)

  • Gavin Jones says:

    Robert Briggs.

    And we know that estate agents, developers, banks and the guardians of probity, lawyers, have always played a straight bat when it comes to advising potential real estate purchasers of pitfalls such as existing mortgages. Paragons of angelic behaviour all.

    “Trust me, I’m a lawyer”, as they say. (Alright. I know it’s ‘doctor’, but what the hell).

  • @Robert Briggs – this subject is covered by the Cyprus Real Estate Agents Law (see Paragraph 20).

  • Robert Briggs says:

    @ Mr Costas Apacket. According to recent E.U. & therefore local law, the property sales / estate agents are obliged to inform their clients, the Title Deed status and the Certificate of Final Approval status of the property/s in ? For verification, please contact The Cyprus Property Action Group ( e: [email protected] ) R.B.

  • Costas Apacket says:

    @John Swift – give em a break John, the poor guys at B-S, (yes it also stands for Buy-Sell), still need to make their meagre 5% commission or they’ll have to sell the BM!

    Wouldn’t it be very interesting to see the answers which you may receive from B-S should you ask them if any of the Deed-less properties they are selling have any other encumbrances listed against them at the Land Registry?

    Surely as responsible agents they would have this information and share it with you in a spirit of transparency and openness … wouldn’t they?

    Go on, be a little devil! ;)

  • John Swift says:

    It’s not just the title deed fiasco that is making people hold back from buying in Cyprus.

    I’m still getting e-mails from BuySellCyprus with prices in cloud cuckoo land. They’re still living in Never Never land.

    When the prices in the UK went up so did Cyprus prices, this was at a time when you could sell up in the UK and have cash left over after buying in Cyprus.

    The latest e-mail I’ve received from BuySell needs to knock up to 100k euros off their properties to make them realistic.

  • Steve says:

    I don’t know whether this should be seen as bad news or something that could lead to good news later if it finally stirs the government to address the property issues.

    What is bad news is the natural gas find if it allows the government to escape the consequences of the property debacle, due to their not needing the income derived from property development and consequently not needing to attract overseas buyers to Cyprus. When government spokesman start saying, for example, that Cyprus has been overly dependent on property development in the past, then fear the worst.

  • Mike says:

    Those few who consider it fair game to rip off foreign investors in collusion with lawyers, banks and agents can now take full and total responsibility for the state that the nation is in and will sink to.

    Will they learn from it – I don’t think so.

  • Costas Afortune says:

    This is just the beginning! With demonstrations outside property shows, and Internet blogs advising would be investors to stay well clear of Cyprus , what do you expect?

    The BBC claim of property scams, MPs raising problems in parliament, and many action groups employing specialist lawyers to fight Cypriot banks and developers. The normal people of this island will suffer because of the greed of some locals, who because of useless laws, title deed fiasco, lawyers not doing there jobs correctly, banks breaking very basic EU regulations on unfair practices, developers being years behind on handing over keys but still refusing to put there hands up, accept responsibility and pay compensation etc!

    This beautiful island has been ruined by a society that thinks its OK to deceive British investors, and legally con them out of thousands.

    Well no more, the Brits are fighting back !

  • @UBoat – the majority of Famagusta district is under Turkish occupation and the part that remains in the free areas is very small.

  • Robert Briggs says:

    Even if sales have plummeted, they are still finding idiots to buy property without Title Deeds.

  • Peter says:

    They have shot themselves in the foot. It’s not just the sales of new villas and the jobs it creates but the wealth that these expats bring to the Island. Many pay taxes but are never a burden on the system.

  • UBoat says:

    Why is it the region of Famagusta seems to come last in ALL the surveys ?

    i.e. property sales as above and transfer of deeds to name but a few ?

  • Costas Apacket says:

    Are we really surprised by these figures?

    Apart from the recession biting all over the world, foreigners have now discovered how they are treated in Cyprus after they have handed over their hard earned money to buy a property which they then do not legally own, and will not legally own for years to come in most cases.

    Where are all the rich Russians who were supposed to be the saviours of the Cypriot property industry?

    Perhaps they have been read about the same issues that we Brits read about and then buy elsewhere?

    When will the Cypriot property brethren learn?

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