IN OCTOBER 2008, the Land Registry presented figures showing the overseas demand for property and highlighting delays in the issuance of their Title Deeds.
- Between January 2005 and June 2008 a total of 37,769 overseas buyers purchased 29,949 properties whose Title Deeds had yet to be transferred. This figure of 29,949 included properties for which Title Deeds had yet to be issued plus those whose Title Deeds were in the process of being issued.
- During the same three and a half year period, 4,440 properties were transferred to 5,988 overseas buyers.
(However, the figures did not reveal how many properties had been issued with Title Deeds that had not been transferred).
The article accompanying the figures reported that sales to overseas buyers accounted for 3 out of 10 sales of property.
Theoretical Title Deeds backlog
Based on the figures published in 2008 – and assuming that the 7 out of 10 property sold to the domestic market were also waiting for Title Deeds to be issued – we can assume that a total 17,760 properties were transferred over the three and a half year period to both domestic and overseas purchasers; an average of 423/month.
According to the figures published by the Department of Lands and Surveys, we know that a total of 183,556 properties have been sold since 2000. If we assume that over the same period of time that the Land Registry has maintained an average transfer rate of 423 properties/month, the number of transfers since 2000 is 423 * 169 = 71,487.
Based on the various assumptions above, the number of properties whose Title Deeds have yet to be transferred is 112,069 (183,556 – 71,487). But this figure does not include sales that took place before 2000 and, therefore, the actual number will be somewhat higher; a figure of between 120,000 and 130,000 is not unreasonable.
However, the Department of Lands and Surveys has published no statistics that provide the actual numbers of properties waiting for Title Deeds.
It seems that the Troika may have identified the problem and this resulted in them back-tracking on the requirement for Cyprus to reduce the Title Deed backlog to less than 2,000 cases of immovable property units with title deed issuance pending for more than one year by Q4-2014.
Buried in section 1.29 of the latest Memorandum of Understanding (MoU), which was issued on 12 April 2013, is the requirement that:
The authorities will establish a Task Force (comprising representatives of Central Bank of Cyprus, Ministry of Finance, the Law Office of the Republic and the Land Register) by end-March to prepare a study assessing the magnitude of registered, but untitled land sales contracts and underlying mortgages and develop recommendations by end-June.
Clearly, much work has yet to be done to assess how many properties are waiting for Title Deeds and the underlying mortgages preventing their transfer; hopefully things will become clearer later this year.
But land sales contracts? Does this include all immovable property sales – i.e. land, commercial property and residential property or just sales of land?
And what about the many other impediments that prevent the transfer of a property to its purchaser such as court judgements in favour of the vendor’s creditors, claims for unpaid Immovable Property and Capital Gains Taxes, costs for the construction of a street, etc?
What a mess!