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

Property highlights all that is wrong

DURING Cyprus’ property sale ‘boom years’, most estate agents/developers employed at least one Russian/English speaker part-time. Now they employ a Mandarin/English speaker, who is likely to be a Chinese lady married to a Cypriot.

Mainland Chinese do not speak English, and those who say they do are limited to several tens of words enunciated incomprehensibly. In fact, it would be nigh impossible for any to negotiate the purchase of a house and live in Cyprus without the assistance of an interpreter.

Selling 2/3 bedroom flats/houses at a minimum of €300,000 in exchange for long term residence permits sounds ‘crisis’ expensive to me. An additional requirement is that €50,000 per person be left on deposit in a Cypriot bank for at least three years, thus a Chinese household comprising a couple with two children would be ‘coerced’ into investing half a million euros in Cyprus before immigration issues four long term residence permits, which purportedly facilitate easier access to EU member states.

If rumours circulated by estate agents/developers of 1,700 sales so far are to be believed, Paphos should be crawling with Chinese by now, but my Paphian friends report seeing hardly any in local supermarkets or sunbathing on the beaches. Last month, a Paphos estate agent confirmed that Chinese sales virtually dried up as soon as the troika imposed the haircut and the government introduced currency restrictions.

Unlike Russian permanent residents and second home owners, who mostly live within a three hour flight of Cyprus, a Chinese family would arrive here exhausted at more than twice the cost of their Russian counterparts; I know, I’ve done both the Moscow and Beijing run. The huge disparity in journey times and costs make me wonder whether the 1,700 sales actually refer to 1,700 different purchasers or several Chinese billionaires buying up new-build apartment blocks and entire housing estates.

Last month, a small and seriously bankrupt developer’s property was repossessed by his bank and auctioned off at almost a third of its pre-crisis market value. Four houses valued at a total of €840,000 went ‘hush-hush’ under the hammer to a single Russian purchaser for €280,000; he is reported to have said that he will sit on his investment until market conditions improve?

If strictly non-resident and simply using Cyprus as a means to ‘leak monies’ hors la Chine, the Chinese are hardly likely to be present, or even represented at hush-hush house repossession auctions. And worse still is that if banking restrictions persist, they will be obliged to look elsewhere to free-up profits from their ‘in China’ enterprises.

So, while established Russian residents, numbered in their thousands, pick up the bargains, the Chinese, pay through the nose for the opportunity to do so, when only six months ago the media reported the so called Chinese influx as ‘an invasion’. Yes, elephants do fly in Cyprus as well as donkeys! But no longer do the Chinese.

This is bad news for our construction industry and banks, who now find themselves left with critical over-supply of property, currency restrictions and an ever decreasing number of willingly duped buyers.

For years, our administration and banks have cleverly created a captive audience, holding householders to ransom by refusing to issue title deeds. Oh yes, there is method in this title deed madness! In fact, if all developers’ debts to banks were taken into account, most of the island’s property is owned, on paper, by bankrupt banks.

Sickeningly, we are now paying (via troika haircuts/theft and increased taxation) to restructure our banks, only for them to become the island’s landlords, who are subject to the will of the barons in Brussels; a situation redolent of those times when our Church collected taxes for the Ottomans.

After just 53 years of ‘freedom’, we have again become members of that familiar servile feudal class formerly under imperial rule. Bravo! This is what happens when you grow too big for your boots and can’t afford a new pair.

I recently visited an estate of 4 x 4 bedroom ‘luxury’ houses with pools – summer lets at €200 a day, minimum stay two weeks – situated a stone’s throw from the beach. The developer, who spotted me nosing around, invited me to view the one he, his wife and two children were occupying during this past Easter school break.

Spotlessly white concrete, glass trolley sized manicured and characterless, situated next door to a tavern oozing the stench of burnt cooking oil denied even a mild interest. I told him that he’d never sell ’em never mind let ’em with that fish fryer next door! He pretended not to smell the smell and will walk the walk to the gallows of bankruptcy like those many deluded developers before him.

Last week, the co-operative bank told a year-long unemployed engineer, who could no longer finance his house loan of €140,000, that he would become a tenant in his own house and pay rent. In other words, the bank has seized landlord status ownership. The ‘new tenant’, married with three daughters, can see no worthwhile reason to remain in this ‘burnt-out’ island and is emigrating from Cyprus to Australia.

But Cyprus is still burning while those responsible for igniting the fire keep fiddling. The ‘barons’ gave us just enough rope by which to hang ourselves and are now watching our every move; deviousness is dead. After years of misrule, our administration will be driven to raise standards or be ‘flogged’ for inventing yet more ‘ingenious’ ways around having to do so.

It takes a lifetime to build a good reputation and a few moments of indiscretion to destroy it. How long will it take our present administration to rid itself of its badly soiled name; a few years or another lifetime? I’m betting on never unless we remove those responsible for bringing the nation to its knees, one that will now be compelled to accept a lose/lose solution for us to the Cyprob. Bravo!