FOLLOWING the practice of many banks around the world, the Bank of Cyprus plans to launch a website in the next two or three weeks where it will advertise all the property that it owns and wishes to sell.
Needless to say the Cyprus Real Estate Agents Association has objected as it feels its members should be involved in the sell-off/fire sale.
According to a Cyprus Daily source: “Calling for proposals is a sign of transparency and proper sales procedure. Association members who had a meeting with bank officers were told that this is regular practice by lenders all over the world.
“Hellenic Bank (in Cyprus) already follows this practice…Bank of Cyprus has now some 600-700 properties for sale here and abroad, especially in London.
They are mostly branches or other assets of former Laiki Bank.”
However, the same source rebuffed any suggestion that the new website was connected to possible future home repossessions from owners in Cyprus who cannot repay their loans.
“Repossessions are not the lender’s main objective, this is not what the management aims at, far from it,” said the source.
However, it is generally accepted that the larger developers whose bad loans exceed €6 billion will suffer repossessions at some time in the future.
The Bank of Cyprus desperately needs as much revenue as possible and cannot afford the luxury of hanging on to assets it no longer needs.
I do hope any outstanding communal fees for properties on complexes will be factored intro the sale else any new owner will be in for a shock.
@All – You may be interested to know that the Bank of Cyprus launched its Property for Sale website earlier today. Visit ‘Properties for Sale – Bank of Cyprus’ for details of properties that the bank is selling.
We need to be aware, although at the moment we do not have any facts or figures, that the banks are not necessarily looking to get back the value of the house but rather the value of the plot on which they lent money to a developer. Said plot now benefits from a house sitting on it.
For the sake of argument our €300,000 homes may well have dropped in value to €150,000 but the banks may only need to recover €75,000.
Are there people/investors out there who would pay 75k for a 150k property?
@andyp on 2014/07/12 at 11:11 am – Most of the properties that BoC will be trying sell off are former branches of the Laiki bank (I’ve recently driven past 4 – including my old branch that is now empty). These are commercial properties and I doubt that the bank will be selling many residential properties.
We’ll stated Janner. Exactly the point I was trying to get across in my earlier comment. Take out the receiver / bank administration / solicitors and sellers fees that are attached to the resale and also the fact that some of these properties have dropped by 40 percent then the banks would end up with next to nothing. They would also have to maintain and repair the property once they have it in their possession. It just isn’t going to happen. Big write offs by the banks are going to have to happen to sort this lot out
I would like to know if the bank is a registered Estate Agent or one of these operating without a licence?
@Peter Davis on 2014/07/11 at 8:54 pm – as the bank owns the properties, they can advertise and sell them freely without requiring any form of licence.
The bank owns properties and has title deeds for them and can sell them without any encumbrances! Well done BoC. You managed to achieve what many have been trying to do for a long time. What’s that you say BoC, “You don’t actually have the title deeds but you nearly have them and to trust you”. The prospective buyer may well think how can a bank sell a property when it doesn’t own the title? How can a property legitimately exist without a title being issued? Why does the bank own the property? Does anyone else have a claim to the property? Why are there people living in my newly purchased property who say they have paid in full but never received a title? Why are there multiple loans and claims linked to my newly acquired property? Why didn’t my lawyer unearth the encumbrances. Many questions. Few details. Messy times ahead.
@Mike. I suspect that when they do get round to the repossession of “sold” homes to pay off developer debt it would make more sense to go after “sold” homes that were “bought” with cash first. If payments are being maintained on properties “bought” through a bank loan they would probably want to keep that income stream rather than lose that too.
And when these properties come up for sale can we assume they will come with full title deeds and free of any encumbrances such as developer loans, taxes and aged IPT. They will also need to remove any specific performance registered against each property. The final thing after all this would be that the transfer of ownership from the bank to the new purchaser would have to be in place. No good having title deeds without proof of ownership.
Good luck to the banks and lets hope the dodgy solicitors can get it right this time around. Don’t forget they have had one bit of the apple already. I wouldn’t touch one of these resale’s with a barge pole.
By By Cyprus Pie, how many more nails in the coffin lid. Those “larger developers whose bad loans exceed €6 billion will suffer repossessions at some time in the future.” Would those repossessions include homes that had been paid for in full or are being serviced via bank loan?
So many opportunities to right the fundamental problem with a single minded approach and simple legislation but total reluctance to do so. Criminal!
This should be fun, knowing the banks (having had recent experience with a couple of them recently on this very subject), they are likely to be asking for the or very close to the original lent amount, that they won’t have a dogs chance of getting. Whereas current sellers are taking a large loss, the banks will not agree to such losses.
All a smoke screen if you ask me, but I stand to be corrected, I wait with baited breath for this site.
@Pantheman on 2014/07/10 at 4:40 pm – The Bank of Cyprus is between Scylla and Charybdis. If they are not prepared to offer their properties at a discounted price, they will not sell them – and they get no money.