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Luxury property sales weathering the storm

New research indicates that the high-end luxury market for property in Cyprus is weathering the storm with sales in Limassol doing particularly well compared to other parts of the island.

Luxurious Cyprus villa
DESPITE the beleaguered state of Cyprus’ real estate market, its impact on the sale of luxury and high-end properties has not been so apparent – especially in Limassol.

According to recent research into residential property costing more than €2,000,000 it seems that large projects, especially in Limassol, are weathering the storm quite well.

The research shows that during the first half of 2012, 14 of the 16 residential properties costing €2+ million that were sold island-wide were situated in Limassol.

In Paphos between 2009 and 2011 a total of 14 properties costing more than €2 million were sold. However, in the first half of 2012 only one €2+ million property was sold.

In Famagusta between 2009 and the first half of 2012 just three €2+ million properties were sold (one of which was during the last quarter).

High-end sales in Larnaca are similar to Famagusta with 3 properties being sold over the last three and a half years (although there have been no sales yet in 2012).

Nicosia has not performed as well with only two high-end properties being sold; one in 2011 and a second in 2012. The report’s authors consider that this is due to the fact that more than 90% of purchases are made by Cypriots – and because many of them choose to build their own home than buy from a property developer.

Further reading

Focusing on Cyprus’ Luxury Real Estate Dynamics by Leaf Research

Readers' comments

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  • Richard says:

    Properties at this end of the scale generally tend to weather economic ravages well all over the world at all times.

    The ratio between the super wealthy and the availability of homes for them is much easier to control as there are significantly less of both.

    It’s further down the food chain you get problems – where there is significantly more supply of property and people are less wealthy. They commit (usually as a result of excellent snake oil from manipulative sales people) to buy on the basis of ‘illusional’ wealth (or maybe more accurately ‘delusional’) ?

    Super wealthy also are usually better advised around boom and bust (often as they have helped create it).

    So – the super rich are OK?

    You’ll excuse me if I don’t jump and down too excitedly congratulating them…

  • @Steve – It can sometimes be difficult to find articles – there’s nearly 1,400 of them lurking in the archives. The search engine lists them in order of relevance.

    The best thing to do is to put the search in inverted commas “Conor O’Dwyer” – then search – and click on ‘newest’ and ‘oldest’ to charge the listing order.

  • Steve says:

    @Nigel Thanks for pointing out the latest on Conor O’Dwyer. I had in fact read it, but when I put his name into the search facility on your web site, that article didn’t come up for some reason.

  • Gavin Jones says:

    Steve.

    I refer to your final sentence.

    If you don’t get your title deeds on day of completion, it would be “better not to” purchase in the first place. Period.

    I can’t for the life of me understand why people are still prepared to ‘invest’ such huge amounts of money in Cypriot real estate when there’s so much uncertainty about ownership. Total madness.

  • Mike says:

    A friend who came to see me a few weeks ago commented that it seems there is no sign of a reduction in construction projects in and around Limassol. Even the surrounding villages have their fair share of projects under way.

    Obviously the level of building is not as it was during the speculative building boom of a few years ago predominantly in the West and to a lesser degree the East of the Island but it remains substantial albeit in contradiction with reports of the number of permits issued. Curious I know but we must never forget that many locals are not particularly fussed about having deeds to the house as they do have deeds to the land it is built on.

  • andrew says:

    Seems we will never learn, no matter what. Property booms equals property busts. Are we all not fed up with ‘some one’ no matter who, spilling the beans on the latest, greatest, yabba dabba doo property extravaganza. Seems not.

  • @Steve – Conor O’Dwyer won his case (or at least one of them). Please see ‘Brit wins property dispute but must pay for defamation‘.

    Appeals are still pending.

  • @Martyn – one of the suggestions contained in the troika’s draft memorandum to the government was that it “Strengthens existing enforcement procedures and, if necessary, plans for additional legal measures to ensure the issuance of the remaining outstanding Title Deeds by Q4-2013.

    (The the full text of the troika memo can be found at “The economic adjustment program for Cyprus”).

    Regarding guarantees – some developers already offer these and a number have taken advantage of the insurance services offered by ‘Premier Guarantee‘.

    Unless you sign your rights away in you contract of sale, all new properties have a lifetime guarantee against structural defects – but it is up to the purchaser to prove that structural faults have been caused by faulty design, workmanship, materials, etc.

  • Steve says:

    @ Martyn.

    As usual in Cyprus, nothing is what it seems when property is involved. Conor O’Dwyer lost his case when the developer sold his house to someone else despite his having lodged his signed agreement for Specific Performance and making the payments specified in it. As a final humiliation he was ordered to pay the defendants costs. There was talk of an appeal but that was two years ago.

    Then there is the guaranteed title deed. As you say the guarantee is in black and white but does the contract say the title deed itself will be “free from any encumbrances or charges whatsoever”? There is a new class of title deed – qualified or tainted – that prohibits the sale of the property until planning violations are remedied (at the owner’s cost), but allows it to be bequeathed to relatives (so they will have to continue paying the rates and taxes). In this case, would it be better not to have a title deed?

  • @Keith – that’s 16 sold in the first half of 2012.

  • Keith says:

    Your figures don’t add up

    16 sold you say?

    14 in Limassol
    1 in Paphos
    3 in Famagusta

    Surely that is 18?

  • Martyn says:

    The Limassol ‘Top End’ experience,, mainly one suspects in/around the seemingly well designed Limassol Marina (LM) developments now approaching completion, probably accounts for most if not all of the 10 €2m+ sales. Good for the Developers of this high class development and, to satisfy presumably ‘wised up’ purchasers in this Price bracket, they must have been able to satisfy Purchasers of the all important Title aspects.

    Cybarco on their LM website give the following Assurance:

    “By purchasing your property from Cybarco, you are guaranteed your Property’s Title Deed.” But, it seems it’s all a matter of When:

    “When the Title Deeds are issued, (a few years after the completion of the project / property) they are always in the name of the Developer (Cybarco), and then Cybarco transfers the Title Deed of each unit in the name of the purchaser. From the minute your Contract of Sale is deposited at the Land Registry Department, you the purchaser can prevent the owner/developer from transferring the property elsewhere or changing it. Furthermore no burdens, charges or encumbrances can affect your right to seek specific performance after the contract has been deposited with the Land Registry, since you are the beneficial owner.”

    Still though the assurance/guarantee states that the TDs are issued ‘a few years after the completion of the project’.

    Doesn’t this suggest that there are still outdated non-buyer-focused peculiarities in the Cyprus property financing and legal areas? A development the size of LM may well take years to complete – and many more until the last one is sold?

    Surely within the Troika involvement these s-t-r-e-t-c-h factors can be eliminated and the whole area of new Property Title brought up-to-date.?

    Within 5-10 years, all being well, Cyprus will be attracting many more technical, management, legal people , many high-earning and potentially High Net Worth people, to its shores, as the commercialisation of the Med gas accelerates.

    Surely another sizeable reason to ‘sort’ the antiquated RoC legal processes once and for all?

    Maybe, even, in the not-too-distant future Developers can offer 5-10 year Guarantees regarding key quality and construction aspects, backed by a Fund to which all ‘approved’ developers contribute.

    Well, maybe…….?

  • The views expressed in readers' comments are not necessarily shared by the Cyprus Property News.

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