AFTER a long delay, changes to the law designed to help stimulate sales of new property by abolishing and reducing Property Transfer Fees for a period of six months have finally been agreed and published.
The changes came into effect on Friday 2nd December and will remain in force for a period of six months. They apply only to the first sale of a property, where the contract is dated and deposited within the six month window. Specifically:
- For those who pay VAT on their house purchase, no transfer fees are payable.
- For those who do not pay VAT on their purchase, property transfer fees are reduced by 50%.
There are provisions in the law that prevent its abuse, for example, by buyers withdrawing contracts of sale deposited at the Land Registry for Specific Performance, changing their dates and then re-depositing them.
No exemption or discount is available for sale agreements dated prior to 2 December 2011.
@Karen Savva – I’m afraid there are no plans by the government to extend the temporary abolishment/reduction Property Transfer Fees.
As you may appreciate, the government is very short of money at the moment and it needs every Euro it can get.
The legislation is designed to stimulate growth in the Island’s property sector by reducing the cost of home ownership, while at the same time helping property developers sell their stocks of unsold properties.
With regards the decision on Property Transfer Fees will there be a move now to reduce the cost of paying for the deeds to a house? We bought our house from a developer about 9 years ago and at the time were not given the option to buy our deeds. Now when money is very, very tight we are being hounded by the developer to buy our deeds and are really worried as we do not have the money he is asking for to pay for them right now. Will there be any help for so many people like us to help move the property Market on?
@Jane – Please get in tough via the ‘Contact’ link at the top of the page and I will advise you how you can move things forward.
I bought and paid for a property to be built in 2005 by VCC Homes Ltd, Polemi, Paphos, but it hasn’t been finished being built until very recently (and still doesn’t have its utilities finished or connected yet) but I have a Specific Performance registered with the Land Registry Office and the Developer is currently in Prison. I am having problems getting the Completion Certificate, let alone the Title Deeds.
How can I make it that I am able to move into it?
What do I need to do to get the Title Deeds too?
What does the abolishment of property transfer fees mean to me?
@Alex – you are welcome. I have seen reports in the Greek language media that the law has indeed been passed, but I am seeing a lawyer this afternoon and I’ll ask the question.
If the law has not been passed, I’ll post a comment tomorrow.
@Nigel, Thank you very much for clarification!
By the way, I hear that President Christofias has NOT yet signed this law, therefore it is not yet legally binding. I have always thought that publication in the Gazette is the ultimate stage in legislative procedure. However, my Cypriot friends tell me this version of the law is not final and will go back to the parliament for amendments.
Therefore either I mix the facts, or the local legislating is a swamp.
@Alex – The law applies to residential immovable properties such as apartments, villas, town houses, semis, etc., etc., that are sold for the first time since planning and building permits have been issued for their construction.
There are still residential properties waiting to be sold on which no VAT is payable. These are properties for which applications for building permits were submitted before VAT was introduced on 1st May 2004.
The legislation excludes the sale of land for which no planning or building applications have been issued and resale properties.
The legislation is designed to stimulate growth in the Island’s property sector by reducing the cost of home ownership, while at the same time helping property developers sell their stocks of unsold properties.
Can someone ÑÂlarify please what is meant by “first sale of the property”?
If I understand the Greek text correctly, they mean “first sale after the date on which planning permission was granted”.
But you cannot possibly sell anything before that date. Moreover, all new homes now have VAT.
So, how can it be that the house is being sold for the first time and there is no VAT?
Do they mean something built in 2005 and never sold since then?
On the other hand the new, temporary, law states only that you will not have to pay some or all of the transfer fees to obtain your Title Deeds.
It doesn’t say that you will actually get your Title Deeds any-time soon does it?
So you pays your money and then you wait with the rest of us who are not the legal owners of our properties for which we have paid for in full.
Good game, Good game!
@Cyprodite – Not only are you correct in your assumptions, but you also need to factor in where you will be in the Title Deed queue in 6 months time due to the, now longer, queue to obtain Title Deeds.
I estimate that this will add at least 12 months onto the waiting time for you to receive your Title Deeds.
Fair isn’t it!
Folks
And these are the duly elected representatives of the people. Is it any wonder they have found it impossible to find a solution to the nations most critical problem for 37 years. I despair.
But never mind, Land Registry is over-zealously revaluing past purchases for immovable property tax to a degree that will soon bloat the coffers, assuming there are those with more money than sense who pay it.
Altogether an abomination of legislation purely and simply designed to protect the large developers of this land who if declared insolvent will bring the whole deck of cards crashing down with an almighty bang, then you will see rats scurrying into corners to distance themselves from any involvement and quickly run through lists of who they can blame. Mr Orphanides seems to be the only one talking any sense with a hint of reality.
I wonder if this ruling also applies to those about to buy property using the Governments €37K grant for refugees?
@Cyprodite – I’m afraid that’s correct. The law is an attempt to stimulate sales of new property; it is not intended to help those who have already bought.
So do I understand correctly that those of us that have been waiting for our title deeds for years and years and who are now paying a small fortune to make use of the planning amnesty to get our title deeds will not be able to make use of this deal? But for the next six months the developers who have been holding out on us can benefit by selling off properties to new buyers who will get their title deeds free and for gratis? Or am I getting it all wrong?