MP Kostis Efstathiou has submitted a proposal to amend existing property law, aiming to bring greater transparency to property transactions and protect unsuspecting buyers from hidden legal and financial burdens and prevent them becoming trapped.
Under the proposed amendment to the Sale of Property (Specific Performance) Law, the Land Registry would be legally required to disclose any encumbrances such as mortgages, loans, or legal claims before a sale is completed. The Land Registry would issue a written statement to all parties involved in the transaction, confirming whether any such burdens exist on the property.
Proposal amending the sale of property laws (Greek)
Proposal amending the sale of property laws (English)
The MP’s proposal comes in response to a February ruling by the Court of Appeal, which clarified that the Department of Lands and Surveys (Land Registry) is under no current obligation to inform buyers of pre-existing sale agreements.
The ruling raised serious concerns, especially given the thousands of property buyers who have found themselves “trapped” in complex legal limbo due to encumbered properties.
Thousands of property buyers trapped by encumbrances
Over the years, thousands of property buyers in Cyprus have become victims of either poor legal advice or their own misplaced trust. In many cases, lawyers acting on behalf of buyers failed to carry out proper due diligence, buyers failed to use an independent lawyer or used the same lawyer as the vendor or in some cases used no lawyer to save themselves money.
To address this, the government passed the so-called “Trapped Buyers Law” in 2015. This law had the objective of transferring a property to its purchaser(s) who, although they had fulfilled their contractual obligations to the vendor, were unable to obtain its Title Deed.
However, that safety net collapsed in June 2024, when the Appeals Court declared the law unconstitutional. At that point, around 11,462 Title Deeds had been successfully issued, while another 9,497 cases remained pending at Land Registry offices.
A partial solution in the works
In response to the court’s ruling, the Ministry of Interior has been developing new regulations aimed at resolving these cases. According to Interior Minister Constantinos Ioannou, the updated framework should help resolve around 50% of the cases. According to reports, the new regulation allows forced transfer of Title Deeds to buyers if no property encumbrances existed at the time the sales document was submitted.
This still leaves a glaring issue: how will the government help the remaining 50% of buyers who purchased in good faith, paid in full, but remain without legal ownership of their property?
A step toward accountability
Efstathiou’s proposed amendment represents a significant step toward restoring trust in the property market by holding the Land Registry accountable for disclosing vital information before a sale is finalised.
If passed, it will help prevent future property buyers from becoming trapped by pre-existing encumbrances such as mortgages, loans, and legal claims.
This has always been my argument as we purchased a property at end of November 2008 and the contract of sale was deposited to the Land Registry in early December and then the developer took out a mortgage on the Complex Mid December at the time of our Contract being deposited there was no encumbrances and here we are over 16 years later and still no Title Deeds. It is an absolute joke.