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Home repossession ban extended

Parliament passed a bill by the slimmest of majorities to extend the ban on repossessing homes whose purchasers have no Title Deeds even though they may have paid for them in full.

Home repossession ban extendedPARLIAMENT on Saturday accepted the president’s referral of a bill that indefinitely banned repossession of houses whose owners have no title deeds – even though they may have paid for them in full – because developers had already taken out loans on those properties which they cannot repay.

President Nicos Anastasiades refused to sign the bill, passed in March, into law, arguing that it was unconstitutional and created ‘a general and permanent shield’, not for vulnerable groups, but for a number of sellers and land developers.

He sent it back to parliament, which could either accept the referral or refuse to do so. In the latter case the issue would have been settled by the Supreme Court.

Twenty-seven MPs – from DISY, DIKO, EVROKO – voted in favour and 26 – AKEL, EDEK, Greens, Citizens Alliance and Zaharias Koulias – against.

Developers’ land and buildings are counted as assets that need to be offset against their debt to banks, which gives lenders a claim on people’s properties that had been mortgaged by developers.

Tens of thousands have been left without title deeds as a result.

In March, MPs basically scrapped the date included in a clause in the main foreclosures law, which exempts this category of properties from repossession until April 30. This date was extended to July 10 on Saturday with the vote of 37 MPs.

According to the provision, such properties will be exempted provided the buyers paid at least 80 per cent of the sale price or have fully complied with their contractual obligations towards the seller.

The government pledged to draft legislation dealing with the matter in a couple of months.

Under the terms of its bailout, Cyprus has set up a task force “on registered, but untitled, land sales contracts” that must prepare a study by the end of May.

This should have been done by October last year. [Editor’s comment: An earlier MoU called for this study to be completed by the end of June last year].

Readers' comments

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  • Denton Mackrell says:

    @Sam Mabrouk. I agree with Nigel. I too have been blessed with two different law firms for 11 years that I use for different purposes. One has done all my conveyancing and title deeds stuff. None of the Mickey Mouse nonsense that you report experiencing. How did I identify them? Word-of-mouth from an English Cypriot hotel manager friend of mine.

    If you don’t know anyone here to ask, then the British High Commission list is a good place. However, if a lawyer is not on that list it does necessarily mean they are incompetent or dodgy – one of mine is on the list and one is not.

    It is a pity that, unlike UK, Cyprus’ own lawyer’s body the Cyprus Bar Council is a trade union to protect lawyers and does not offer any meaningful help to the public – so don’t bother asking them!!

  • Sam Mabrouk says:

    @ Nigel Howarth- The lawyers I found asked for a fixed fee of €850 just to meet and start the process with no promises, he agreed to meet and discuss general matters after paying him €300 (in America the pre-signing cost is $0). I didn’t feel comfortable talking to the property owners as they were playing games not doing business the proper way.

    @ Peter Howard- I was looking for properties between €40k & 60k which is very decent for a studio or one bedroom apartment (that budget can buy me a condo in Florida, Italy or Spain). Sorry if you over paid for yours.

  • Chris says:

    Nigel thanks for your comments that you have been lucky some would say pleased to go 11 years without issues with your property.

    Agree with you that EU Countries including the UK employed Eastern Block labour to reduce costs. However the more established Developers still use qualified local craftsman to guarantee the build quality.

    The key point is that the UK compile to international recognised Standards API/ISO proven building regulations which is Cyprus just lip service. We purchased our Villa which is classified as luxury Villa from a well know Developer with a good reputation on the East side of the Island. The build quality of the Villa is very good in comparison to several other developments that you have mentioned.

    We purchased our property in (2010) initially as holiday place as we live / work in the Far East. The problem is after more than 5 years after paying in full for the property we are still waiting for our title deeds.

    The COA was issued in 2013 but the Developer still to pay his taxes to proceed to lodge the transfer of title. The excuses which our Lawyer informs us that the Developer is still in dispute with the local authorities on green area which is just another delaying ploy. How can this happen especially that part of MOU was to reduce outstanding title deeds to > 2000 by end of 2014.

  • @chris on 2015/04/19 at 7:31 am – There are plenty of honest and competent lawyers in Cyprus. A good place to start looking is the list published by the British High Commission in Nicosia.

    As for building a property to UK specifications (a) you would not get a building permit and even if you did (b) the place would probably collapse if there was a mild earth tremor.

    In 2008 there was a mild (5.2) earthquake in Lincolnshire that caused £30 million of damage. There was a stronger one in Paphos (5.6) a few days ago that resulted in no structural damage.

    With one or two exceptions, developers do not do the construction work. Construction is usually put out to competitive tender to licensed building contractors. The problem is that some of these contractors cut corners to maximise their profit.

    And I’m sure you’re aware that there are many eastern bloc workers in the UK construction industry from Poland and Romania mainly.

    I’ve been in my house for 11 years and have had absolutely no problems, but I agree that many of the properties thrown up during the boom years were very poorly built and now suffer numerous problems.

  • Peter Howard says:

    Sam Mabrouk. I totally agree with Nigel and if you had followed his previous advice and looked for a property with Title Deeds and used an honest lawyer – then you would not have any problems with a property purchase.

    I would suggest that your options were already limited as you expected to come to Cyprus, and buy a nice apartment – for a budget of around € 20,000.

    It is OK to blame your lack of a property purchase on the fact that you had unrealistic price expectations, but do not label Cyprus as a hotbed of corruption – because if you had a realistic budget, and followed Nigel’s advice – you would have no problems at all in purchasing a nice apartment

  • chris says:

    Nigel so what you saying better look for Lawyer in another EU Country who is competent in Cypriot law what ever that means. Let be frank here Cyprus property market is dead nobody in the UK will invest in Cyprus unless a fire sale. France offers far better value.

    Buying a property with fit for purpose build quality to last. Unless a property has been built to UK specifications by a a tradesman instead of an eastern block labourer what chance have you got. Many of the so called Developers have no skills or competency made a killing in the Property bubble just land owners or in reality (Farmers)

  • @Sam Mabrouk on 2015/04/18 at 5:13 pm – You can avoid the nefarious practices of the ‘crooks’ masquerading as property developers by restricting your search to properties that have a clean Title Deed – and by using an honest lawyer who truly represents your interests.

    If you follow that advice, you shouldn’t run into any problems.

  • Sam Mabrouk says:

    Cyprus is a corrupt hot mess. I’m in the market for a small apartment, and visited the island last week to look at the different options I found there. I came to this conclusion “NEVER buy a property in Cyprus”

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