ILN: BUYING AND SELLING REAL ESTATE - AN INTERNATIONAL GUIDE

[BUYING AND SELLING REAL ESTATE IN CYPRUS]

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5. Submit the Contract of Sale at the District Land Registry. Filing of a contract of sale with the Land Registry creates in favour of the purchaser a real interest (akin to an encumbrance) over the property and gives to the purchaser the right of “specific performance” of the contract. 6. Transfer of property in buyer’s name. The property is transferred in the name of the buyer at such time and upon such terms as stated in the sale contract. It is important to note that for the transfer of the property to be possible (a) the seller must obtain a Tax Clearance Certificate; and (b) Transfer Fees must be paid. Transfer fees are calculated by the Land Registry on the value of the property (as valued by the Land Registry) as follows: Value Rate Current rate of 50% €0 - €85.000 3% 1,5% €85.000,00 – €170.000 5% 2,5% €170.001 and above 8% 4% Exceptions may apply on the payment of transfer fees where the sale is subject to VAT. Where the purchaser is a non-EU national, before proceeding with the transfer of the title to the property in his name, he should obtain a permit from the District Office (which is basically a procedural/administrative step). This requirement does not apply, where a non-EU national purchases the property through a Cyprus or EU company (e.g., where the buyer is the owner of the company, and

the company acts as purchaser in the transaction). C. PERMANENT RESIDENCY BY INVESTMENT Non-EU nationals may use the fast-track permanent residency programme run by the Cyprus government. The applicant must invest at least €300.000 in one of the following investment categories: (a) Housing / apartment investment : Purchase of a house and/or apartment from a land development company, of at least €300.000 (plus applicable VAT). In this case a resale is exempted from the scheme programme. (b) Investment in real estate (excluding houses / apartments) : Purchase of other types of real estate such as offices, shops, hotels or similar developments or a combination of these with a total value of € 300,000. (c) Investment in a share capital of a Cyprus Company with activities and staff in Cyprus : Investment worth € 300,000 in a share capital of a company registered in the Republic of Cyprus, which is based and active in the Republic of Cyprus and has a proven physical presence in Cyprus and employs at least five (5) people. (d) Investment in shares of Cyprus Investment Organization Collective Investments (type AIF, AIFLNP, RAIF) : Investment worth € 300.000 in shares of Cyprus Investment Organization Collective Investments. Upon investment being made and filing of an application under the scheme, which is approved, the permanent residence can be granted to the main applicant, spouse, children, parents, and parents in law of the applicant. There is no renewal requirement -the permit is valid for life.

ILN Real Estate Group – Buying and Selling Real Estate Series

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