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Immovable Property Tax will be less in 2014

Owners of property in Cyprus will be asked to pay less Immovable Property Tax this year as many more properties have been included the island’s Interior Minister Socratis Hasikos has stated.

Immovable Property Tax (IPT)PROPERTY owners could pay less Immovable Property Tax this year as authorities update real estate values as part of the island’s bailout terms.

“People will be asked to pay less than last year and the reason is very simple, many more properties have been included,” Interior Minister Socratis Hasikos told state broadcaster CyBC.

As part of the bailout, Cyprus has to update real estate values by mid-2014.

Up until 2013, property owners were taxed based on 1980s values with many paying peanuts and others nothing at all.

The minister said the re-evaluation procedure was almost complete though Cyprus had another big challenge to address – title deeds.

Cyprus must cut down the number of pending applications to 2,000 by the end of the year in line with the bailout terms.

This is a very big operation and employees from other departments have been brought in to help the land registry, Hasikos said.

“These are matters that we should have sorted on our own years ago but we didn’t and the troika (lenders) had to step in,” the minister said. “In this instance, they are welcome.”

IPT Bill

Readers' comments

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  • sue says:

    If they trained the people who work in their offices to use a computer, they would work faster, I went with a friend to pick up plans, a couple of years ago, the woman had to search through piles of plans on the floor
    to find them, one computer between the planning office workers!!!

  • Peter Howard says:

    John Swift. Why so negative ? Your say your friends bought a property for 54,000 euros then peaked in price after 7 years and now you comment that it has fallen in value to 250,000 euros !! To me this seems like a very good investment.

    I am certainly not here to defend BuySell but it should be noted that in most cases the owner of the property determines the price that the property is advertised at. I am an estate agent and can confirm that many property owners have totally unrealistic expectations as to the value of their property.

    It is also difficult to compare prices in Chesterfield with Cyprus, as there are so many variables when doing comparisons. For example we recently had a client who sold a one bedroom apartment in the centre of London for £420,000 and then came to Cyprus and bought a spacious two bedroom apartment for € 110,000 ( £92,000 )

    Property prices in any country go up and down. 4 years ago I could not get a reasonable offer for my house near Cambridge – now prices and property sales are booming again.

  • @John Swift – A property could go from 54,000 euros to 393,000 in just 7 years because that’s what people were prepared to pay.

    At the height of the boom plots of land similar to ours were selling for ten times the amount we paid.

  • John Swift says:

    I understand what you’re saying Nigel but the bubble would have burst when Title Deed farce became general knowledge, even before the recession hit I’d become aware of the dangers of not receiving your title deeds despite the assurances given by a certain forum owner.

    How a property could go from 54,000 euros to 393,000 in just 7 years as our friends did beggars belief. By 2012 it had fallen back to 250,000 euros.

  • @Costas Apacket – The problem is that such a move would increase the Property Transfer Fees for the other 100,000 who are still waiting for their deeds to be issued as their properties are worth more today than when they bought them.

  • @John Swift – Property prices are driven by supply and demand rather than any intrinsic value they may have.

    Demand in Cyprus increased when it was announced that Cyprus would join the EU – and this, coupled with a lack of supply, resulted in rising prices. But now there is little demand and an oversupply of property, prices have fallen.

    Now in the UK – and particularly in London – prices are rising due to increased demand and a lack of supply.

  • Costas Apacket says:

    As long as it benefits someone Nigel!

  • John Swift says:

    Nigel, 30,000 is an awful lot of properties in negative equity.

    I’ve probably said before that when we first started making plans back in 1998/9 you could sell a 3 bed semi in the Chesterfield region of the UK and have a considerable sum left over after buying a decent detached property in Cyprus.

    By 2007 in just a few short years the position had completely reversed.

    Even without the 2008 financial catastrophe the Cyprus property market price acceleration could not have been sustained any longer, as in the UK prices would have had to fall.

    That was the main reason why we chose to rent in Cyprus and rent out our UK property.

  • @Costas Apacket – If the new lower ‘real market’ valuations was used to calculate Property Transfer Fees, it would only benefit the 30,000 or so whose properties have fallen in value since they purchased.

  • Costas Apacket says:

    Presumably when the property revaluations are completed at today’s real market values, the new valuations relative to the 1980 valuations should be lower in many cases and this may also result in lower IPT levels. (Obviously dependant on the new sliding scale of % charges yet to be announced.)

    Wouldn’t it be great if these new lower ‘real market’ valuations could also be used to calculate Title Deed Transfer taxes?

    Maybe Hasikos has this in mind?

  • John Swift says:

    What I find amazing is that I regularly receive emails from BuySell still quoting ridiculously high prices, don’t they know that Cyprus and the Cyprus property market are still in deep recession?

  • kufrahdog says:

    The evaluation process, according to our Mukhtar, is not just about evaluation for IPT 2014 purposes. Apparently all villages in our district have undergone an external check to bring houses on to the national housing inventory.

    Properties not previously registered have been added to inventory. Properties that are illegal (or have illegalities) because they violate the planning and building laws and regulations have been noted. Properties whose owners/purchasers have submitted applications connected with rezoning or the provisions of the Town Planning Amnesty have been noted. Doubtless other aspects have been noted too; and this, no doubt, is why the article states it is ‘a big operation’.

    Yes, the effort is about IPT for 2014, but it is also about much more than that. The minister is not giving much encouragement at this stage to purchasers who want their TDs, but then this article is perhaps another frustrating sound-bite. One awaits the outcome of this ‘big operation’ with more than a little interest. KD.

  • scruffy says:

    We spoke with a couple of evaluators in February. They were outside our house with clipboards and when I asked what they were doing they explained they were doing house valuations in all Larnaca villages.

  • @MartynG – A friend of ours in Episkopi was visited a few months ago as part of the revaluation process – she has an old village house.

    For those properties with deeds, I doubt that an inspection will be necessary as the Land Registry will have details of the property on file.

    And incidentally anyone can view their plot/house – the Department of Lands and Surveys has an on-line application accessed through its website.

  • Adrian says:

    This is good news as far as it goes but if you do not have your title deeds you will still pay the higher rate of the developer and then when your deeds are available you will have no choice but to pay the developer before he will sign the title over to you. The solution to non registered (mostly Cypriot owned homes) was that as soon as the water or electricity was connected the authority should be advised and the property registered, simples!!

    TIP FOR PAYING IPT. Tell your lawyer that when he goes to the land registry to sign over the title deeds from the developer then and only then does the developer receive payment for the IPT, otherwise you could be giving the developer several thousand pounds and he keeps it and the government will not issue your deeds because of unpaid taxes. Do not trust anyone.

  • MartynG says:

    Hasikos’s comments re TDs are about the only ones I have seen or heard from anyone in Government.. Plus an open admission of previous negligence in tackling these core matters, now there’s a Cyprus novelty.

    Regarding IPT, we’ve not seen any signs of physical inspection towards re-evaluation. Has anyone?

    Rumour has it they are using Google platforms to do it ‘remotely’.

  • Peter Davis says:

    So if we are all paying for our Government’s incompetence why were some home owners exempted?

    Shouldn’t there be one set rate for all, regardless of the home or villa the individual occupies?

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