Real Estate
Property Sale
“Professional legal guidance for selling property in Cyprus, from contract to completion.”
We have extensive experience in real estate cases in Cyprus.
We assist our clients in the Sale of their immovable properties and guide them through the whole legal procedure, from the initial stages of their transaction to their final completion.
Our Services
Our services include advising as to the documentation and information necessary for the sale, negotiating, drafting and reviewing of the sale agreements, consulting on financing matters and tax impositions, and arranging settlement of outstanding amounts with third parties, such as bank institutions, loan management companies and developers.
SELLING a property in Cyprus within 3 comprehensive steps:
1. Counseling the Seller on the necessary Documents and Information for the Property Sale:
- Recent Updated Title Deed OR Copy of the Original Sales Agreement.
- Recent Search at the District Land Registry.
- Detailed information as to possible encumbrances (e.g., mortgage).
- Cyprus Tax ID Number.
- Compliance with AML (Anti-Money Laundering) laws and client KYC checks.
2. Drafting, Reviewing & Negotiating the terms of the Agreement in accordance with the Seller’s instructions, concerning:
- Property Purchase Price, Payment Mode and Currency.
- Property Contents.
- Encumbrances.
- Property Structural Condition, Property Amendments and Construction Terms.
- Possession Date of the Property and Completion Date of the Transaction.
- Taxes, VAT, Utilities and Common Expenses.
- Insurance Policy, Advertisement and Tenancy.
- Council of Ministers Permits.
- Compliance with AML (Anti-Money Laundering).
3. Completion of the Seller’s Property Transaction
- Obtaining the necessary Tax clearances (e.g., Capital Gains Tax, Immovable Property Tax, Local Government Clearances).
- Obtaining of VAT approval (if applicable).
- Disconnection or Confirmation of transfer of the.
- Third Parties Settlement of Outstanding Amounts (e.g., bank institutions).
- Liaising with the Parties necessary-Communicating with the Purchaser’s lawyer, Land Registry, Tax Department, VAT Department, Bank Institutions, Currency Broker, Developer, Estate agent.
- Physical Presence at the District Land Registry for the transfer of the title deed (if applicable).
Benefits
• Growing Demand from International Purchasers- faster sales and competitive prices
Popular with Purchasers from the UK, Middle East, Israel, Russia, and Central Europe.
• Straightforward Selling Legal Process
The Cyprus government has streamlined the property transfer process aiming high standards of safety for Sellers, and lawyers play a key role in ensuring due diligence and compliance.
• Tax Regime
No inheritance tax, potential 0% capital gains tax on some transfers depending on specific exemptions.
• Cyprus Property Market Trends Support Sellers
Rising rental yields have boosted property values.
Infrastructure projects, marinas, highways, airports, tech hubs and universities have increased interest in previously undervalued areas.
• Opportunity for Capital Gain
Sellers bought properties before the recent real estate market surges will benefit significant capital gains.
• Reinvestment Opportunity
Sellers often reinvest in Cyprus, capitalizing on gains, e.g., upsizing.
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FAQ
1. What is a Reservation Deposit Agreement?
A reservation deposit agreement is made between the Seller and the Purchaser for a specific amount. The Seller is usually obliged to remove the property from the market during the reservation period.
The reservation fee is based on the purchase price and is normally between €1,000 and €10,000, depending on the situation, and is usually held in trust by the estate agent or the Seller’s lawyer until the agreement is finalized.
2. Is a Reservation Agreement compulsory?
A Reservation Deposit Agreement is not compulsory and it is in the discretion of the Seller and Purchaser to entered into the said Agreement prior to the signing of their Sales / Assignment Agreement.
3. Is it possible for Property to be sold through Probate?
Yes, provided that the relevant probate order appointing an Administrator of the Deceased estate and the relevant probate tax clearances have been issued.
4. Is it possible for a Property to be transferred as a Gift?
Yes, the transfer of Property as a gift is usually taking place between persons who have family bonds with each other, e.g., parents to children.
5. Who needs a Council of Ministers Permit and are there any conditions for its issue?
A Third Country National registering a Property in his/her name in Cyprus need a Council of Ministers permit. A National or European Union Citizen do not need Council of Ministers permit.
There are specific conditions for the issue of the Council of Ministers permit, as to the number, the size and the type of a Property or Properties the Third Country National is entitled to acquire in Cyprus.
6. What if I am Not in Cyprus to handle my Property Sale or I need a third party to handle my transaction for any other reason whatsoever?
When such circumstances arise, it is possible for the Seller to grant a power of attorney appointing a third party as their representative for the purposes of their transaction.
Our Law Firm’s members may also undertake to act on the behalf of the Seller through the whole conveyancing procedure as their lawful legal representative, before all the necessary government authorities in Cyprus, provided that a relevant power of attorney is provided.
Please note that as soon as the drafting of the relevant power of attorney is concluded, it will need to be properly signed and duly stamped and certified.
7. How long does it take for the Property Sale to be completed?
The Sale can take several months, depending on the specific circumstances of each property sale, e.g., whether a sales or an assignment agreement will need to take place.
It’s advisable to work with a Cyprus lawyer to navigate potential delays and ensure all legal requirements are met.
8. What taxes are usually imposed under a Property Sale?
- Capital Gains Tax at 20% tax on the profit from the sale. Exemptions of No CGT might apply.
- Refugees Tax at 0.4%.
9. What information is needed for the calculation of the Capital Gains?
-Original Purchase & Selling Price.
– Costs of Acquisition and Costs of Sale:Legal fees, Agent commissions, Advertising costs.
-Improvement and Renovation Costs.
-Acquisition and Sale Date.
-Information as to generating Income from the Property in the form of Rents.
*Documentation as per the above will be required by the Tax Department for the calculation of the CGT.
10. When is 0% capital gains tax applicable?
It is usually applicable when the sale concerns the Primary Residence, which was the Seller’s main residence for at least 5 years. In such a case up to €85,430 of the gain is exempt and this exemption is used once in a lifetime. Relevant documentation will be requested by the Tax Department for the application of the 0% CGT exemption.
Other usual cases are:
– No CGT is applied when property is transferred upon death.
– No CGT is applied when property is transferred as Gift between close Family Members, such as spouses, parents, children and siblings.
*No GPT also applies in some other more rare cases.
11. Why shall a Property Seller instruct a lawyer to handle his/her transaction?
Hiring a Cyprus lawyer is highly recommended, since a lawyer will assist with the documentation necessary for the Seller’s transaction, draft and review the Contract of Sale, and guide the Seller through the whole transaction process until completion, securing the Seller’s legal interests in the best way possible.
*The above constitute general information and does not substitute professional legal advice or consultation, which shall be sought prior of taking any action.