ALTHOUGH the problem of the Title Deeds is not of this government’s making, its handling of the matter could not have been worse. Without properly studying the matter, it made promises to interested parties that it could not keep, given the complexity of the matter.
It turns out now that the legislation the Cyprus government had promised to pass to help owners obtain Title Deeds for their properties is only targeted at a select group of buyers: those who had properties in buildings for which the developer had not obtained a final certificate of completion because certain planning laws had been violated. With the new legislation, a final certificate of completion would presumably be issued irrespective of the illegalities so that people can receive their Title Deeds.
This law will be of no help the majority of the 30,000 foreign home-buyers who cannot obtain Title Deeds because their properties are technically still owned by the banks and being held as collateral against loans given to developers.
It is a scandalous state of affairs that fully protects the interests of the banks while leaving ordinary people without any protection. Cyprus is probably the only country in the developed world where a property seller is not obliged to hand over the Title Deed to the buyer as soon as full payment is made.
Now that we have entered an economic downturn and the property market has slumped, property-owners are understandably in a panic over what might happen to them. What would happen if the developer from whom they had bought their holiday home goes bankrupt – a real possibility in today’s conditions? Would they be kicked out of the property they had paid for, so it can be re-sold by the bank? Would they have to buy it again from the bank wanting to cut its losses?
Despite its promises, it appears the government has done nothing to allay the fears of foreign home-owners. The legislation currently being prepared could help a few of the 100,000 people without Title Deeds, even though the idea of an amnesty failed when it was tried in the past.
Cash-strapped developers would be reluctant to issue Title Deeds, because they would have to pay capital gains tax for every Title Deed transferred to the rightful owner. The authorities allowed developers to exploit the loopholes in the law for so long that any messing with the big anomalies that were created could now lead to an economic collapse.
This is no excuse for the government’s inaction and certainly no consolation to property owners. The government needs to examine the matter in great detail: establish the exact number of home-owners without Title Deeds, then examine what needs to be done for these to be issued and set targets. It may take several years to clear the backlog, but this would be a start and people might feel a bit more secure, knowing that the government is treating the matter seriously.
But promises not backed with action are guaranteed to make anxious home-owners fear the worst. They do not deserve to be treated so shabbily.
Copyright © Cyprus Mail 2009
