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Wednesday 2nd December 2020
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Trapped buyers get Christmas present promise

Trapped buyers in Cyprus get Christmas present promisePARTIES on Wednesday said they intend to resolve the Title Deeds mess by Christmas, as ruling Disy chief Averof Neophytou warned banks not to go back on a pledge they had given in July or he will come down on them hard.

Back in July, banks pledged not to raise objections to a disputed law in return for the approval of bills making it easier for banks to foreclose on property owners in arrears on their mortgages.

The 2015 law aimed at helping around 70,000 trapped buyers who had paid for their properties in full but had not been issued with their Title Deeds because the developers had mortgages on the properties.

Since developers’ land and buildings are counted as assets that need to be offset against their debt to banks, this gave banks a claim on properties that had been mortgaged by developers.

The ‘trapped buyers’ law, however, appears to be unconstitutional, although it has not yet been judged by the Supreme Court.

Opposition parties said Wednesday they had prepared a law proposal that essentially included the same provisions as the 2015 law but overcame unconstitutional issues.

During discussion of the matter before the House legal affairs committee, Neophytou reiterated he would come down hard on the banks if they went back on their pledge.

“This was the clear understanding we had,” he said, stressing, however, that they were not prepared to support cases where it was clear there had been collusion between the buyer and the seller.

Akel MP Aristos Damianou said the bill they prepared covered the issues raised in the courts.

“The philosophy of our proposals is adopted by the land registry and it considers them to be in the right direction,” Damianou said.

He suggested however, that certain quarters would try to delay the effort so they proposed the creation of a subcommittee that will seek to resolve any issues with the state Legal Service so as to have a final proposal by November 28.

Diko MP Christiana Erotokritou said three years on, the government was ignoring the thousands of trapped buyers, continuously bringing up the excuse that a bill is being processed.

“Our intention is to have the problem resolved by Christmas,” she said.

The 2015 law grants the land registry director the authority to exempt, eliminate, transfer and cancel mortgages and or other encumbrances, depending on the case and under certain conditions, as the state sought to sort out the Title Deed mess.

However, banks contested the 2015 law and won rulings that it was unconstitutional.

Courts said it violated Article 26 of the constitution, which affords individuals the right to enter freely into any contract.

Banks had said at the time they would view each case separately.

For instance, there were cases where subcontractors who did work for developers were given flats instead of money, which they probably rented afterwards. They then took advantage of the law to secure a Title Deed.

They also say that in some cases the buyer together with the developer, pre-dated contracts in a bid to get a title, cheating the bank in the process.

These cases do not fall under the pledge and will certainly be contested.

A banking source suggested the parties were putting on a show because they knew it would be very difficult if not impossible to resolve the constitutional issues.

The source also said the banks had kept their pledge but reiterated that each case would be viewed separately.

In the cases where it was clear that the buyer had been shafted the banks withdrew their lawsuits. In the past two months, some 40 trapped buyers had been freed, the source said.


  1. Even if this is achieved, it will take them about 5 years to clear the backlog unless they have a huge increase in staffing resources at the Land Registry.

  2. Hi Nigel – Further to our correspondence 11/4/17 to 22/4/17 when we were on the last stages of getting the title deeds through trapped buyers. I was presented with court papers from the developers bank stating there was a mortgage on the land preventing us from obtaining deeds. This was in June 2017, since then we have been into the land registry the last time being in August we were told nothing had changed. Since this announcement in your article we are wondering how to go forward from now.

    Ed: I’m afraid you’ll have to wait until the government sorts out the mess it allowed the banks to create. I suspect you purchased the property without taking a loan?

  3. After wanting the deeds for so long, I’m not so sure I’ll be better off? How I understand it is those with a mortgage won’t expect to see the deeds until the mortgage is paid off anyway so can sell as normal in the meantime whilst I may get them ‘now’ but with notes. A pergola would seem to be the least of the problems (I haven’t made any alterations) but without a final cert confirming the safety of the actual building materials themselves how will this help in being able to sell?

    I have repeatedly asked this question of Civil engineer and the architect of the development, both refuse to cooperate and the new manager who seemed helpful when I visited has since declined to respond.

    There’s a huge hotel going up next to their office but I was actually told there was no money left to certify our small finished development, for which they’ve already been paid, whilst the new manager told me my property is in the hands of the Land Registry now so he cannot help.

    I don’t have funds to independently pay for load testing, higher balconies etc etc, provision of a Green permit for being connected to the sewage, even though I’m paying the water board!!! Is all this what will be noted on the deed, does anyone know please? I’m guessing that the lack of a final cert invalidates my building insurance too and will do in any event without the engineers clarification that all has been built to a safe standard?

    Ed: People with loans/mortgages can gat the Title Deed for the property they purchased. The Completion Certificate confirms that the property has been built according to the approved permits and plans for its construction.

    If, as you have been advised, your property is in the hands of the Land Registry it will have been issued with its Completion Certificate. This has to be issued before the planning authority passes the file to the Land Registry to issue the deeds.

    I expect that you are paying the water board for the surface water drains and for the supply of water. And the lack of a Completion Certificate does not invalidate your house insurance.

    I suggest you visit the planning authority to get a better understanding of the situation. And if they have passed your file to the Land Registry, check with them as well.

  4. I should think the government should hold developers of wrong doing & get hard on them. As developer owed bank mortgage. Bank should foreclose developer assets instead of those victims paid in good faith in purchase their properties.

    Ed: The banks haven’t foreclosed on buyers who were deceived into buying property built on mortgaged land (assuming they have maintained their loan repayments.)

  5. Hi, I am not sure if I am a trapped buyer. We have been waiting for our title deeds for over 10 years. The problem is that they say our development is complex and because it has been a while people have added pergolas on their properties etc. So they say this has changed the plans.

    For a number of years we were waiting for the certificate of final permission which seemed to hinge on the appropriate certificates being issued. There seems to have been a number of different excuses.

    However, we have not been prevented from getting our title deeds due to a mortgage on the land – until we are at the last stage it is not possible to know about whether there is a mortgage – there have been some rumours that our developer owes money but nothing confirmed. Does this mean that we are not classed as trapped buyers and hence this will not be expedited by Christmas? Thanks.

    Ed: Regardless of whether you are a trapped buyer you need to apply for your Title Deeds as described in my article Applying for Title Deeds (update 17 May). The application fee is €10.00

    You can check at the Land Registry to see if there are any financial issues preventing the transfer by asking them to carry out a Title Seach. You can find out how to do that in my article New title search procedures in Cyprus. The fee is €20.00.

    Although others on your development have added pergolas, etc. these will not prevent you from getting your deeds (and those who’ve added pergolas, etc. need to remove them until the development’s been inspected).

  6. I thought European Law was superior to Constitutional Law and “in determining the effects of legal relations between individual on property the convention organs check that the law did not create such inequality that one person could be arbitrarily and unjustly deprived of property I favour of another. In certain circumstance, however, the State may be under an obligation to intervene in order to regulate the actions of private individuals. To conclude, Article 1 f protocol No 1 applies in general where the State itself interferes with property rights, or permits a third party to do so”. Page 6 of the Council of Europe Handbooks Series (introduction).

    on pg 9 “the effective exercise of the right protected by Article 1 of protocol 1 does not depend merely on the State’s duty not to interfere, but may require positive measures of protection, particularly where there is a direct link between the measures an applicant may legitimately expect from the authorities and the effective enjoyment of his possessions” It’s a good read and useful to see where you fit in the spectrum of the case law. Complain to the EU commission if you’ve got nothing to do tomorrow afternoon.

    Also remember there is something juicy in the constitution says that the State has a duty to compensate you if it devalues your property. My understanding that properties are worth less without deeds rather than with deeds. If you can’t sell it without deeds, it is effectively worthless – wouldn’t it be lovely if 60,000 people wrote to Mr Clerides to ask for compensation!

    On the subject of foreclosure (as I note this legislation is not retrospective, but the foreclosure law is!), a concern for many; don’t forget the ECJ case law says that the court must determine of its own motion the unfair terms any contracts. I doubt that’s what the Cypriot Court will do (if indeed your case gets through the overloaded and creaking system), but it is obliged to. Alpha Bank and Emporiki’s contracts before it were crammed with them, and I am willing to be most Developer contracts were also stuffed with them. They haven’t changed the standard terms since before the law was passed (1993) Look at the judgments on the CCPS website, the outcomes are all very similar. Nigel told us in a recent article there are 52 languishing at the CCPS because it has no judicial authority. Any way, theoretically if the Bank forecloses your contracts should be reviewed by the Court (of its own motion) before the Court passes judgement. Let’s hope the state has put the proper training in place. It’s not too late to send your contracts to the CCPS for a judgment in readiness, even if your contracts go back a decade or more. Keep them busy and as the judgements build they’ll have to take action sooner or later and then all at once. If Cyprus has any sense, it would give the alternative domestic remedies legal clout to stop the court system breaking down – or join cases together but that would mean owning up to the great conspiracy that Cyprus Property News Members debate at length (and often with great humour).

    You are entitled to peaceful enjoyment of your possessions and this legal uncertainty is stressful and unsettling. Point your fingers at the State and complain.

    Cyprus doesn’t confer the rights we were led to believe we had, but the EU does and its going to be a buggar asserting them, but please don’t lose hope and take action; especially all the free, or low cost options. Things are moving in the right direction but the people have to lobby to make it happen and stand firm against the bullies. This wonderful publication – the Cyprus Property News – has helped me keep informed, and brings tiny flashes of hope in what seems a hopeless situation. Thank you Nigel.

    We need to be tenacious and refuse to roll over. I am not a legal expert, so please verify the facts with someone who is.

  7. “Our intention is to have the problem resolved by Christmas,” she said.

    Yes, but which Christmas??

    Ed: This one, I hope :-)

  8. @Nigel, any stats on how many of the 70k trapped buyers have been freed?

    Ed: There are no statistics on the current number of ‘trapped buyers’. But I do know from emails I’ve received that many have received the deeds to the property since the law was introduced in 2015 and, according to the article, 40 trapped buyers have been ‘released’ in the past 2 months.

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