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Holiday homes in Cyprus

The advancement in the living standards, the increase in leisure time and the need to change environment from the daily distressing pressures has internationally caused an increasing demand in second/holiday homes. In this article we will refer to holiday homes for personal use and not specifically for investing purposes.

Cyprus is included in the international markets concerning holiday homes (for medium/high income buyers), with Spain on top of the list, Portugal second, Cyprus third, Malta fourth, with Croatia, Turkey and Bulgaria to follow as the new up coming markets. Greece is not included in the list concerning the purchase of this type houses, for numerous and various reasons, (it has only one international airport, short property supply, complicated title deeds, peculiar and perplexing legislations, almost compulsory false declaration i.e. an objective value instead of the real one etc, etc). In Cyprus the 20% of the overall property purchases comes from foreigners, however it represents the 70% of holiday home purchases in Cyprus.

The purchase of holiday homes in the areas of increased demand, in relation to foreigners/locals is analyzed as follows:

Free Famagusta – Protaras areas ( 50% Cypriots + 50% foreigners). Larnaca

area ( 20% Cypriots + 80% foreigners). Limassol (10 % Cypriots + 90% foreigners). Paphos district (5% Cypriots + 95% foreigners). In the mountainous resorts (Platres – Moniatis etc) the percentage is 60% Cypriots + 30% foreigners, while in other mountainous villages including those with traditional architecture (Lania, Lefkara, Kakopetria) the buyers are mainly foreigners, excluding expatriates.

What should you look for when buying a holiday home?

• Location – This is a main criterion, which is also decisive concerning the fixing of the price/value. The closer to the sea the higher its value is. However, choosing the location is important and you need to examine the immediate environment to the property for any noise pollution (it is situated close to clubs, motorway etc).

• Architecture + Functioning – If the project is architecturally in a bad condition you can be sure that, in a few years, following its delivery/ occupancy, it will have turn into a slum, thus causing a rapid drop in the value of your investment.

• Environment – Examine the immediate surroundings of the project you are buying. Has the Contractor / Developer provided for the planting of any trees and other decorative plants? Has he made a fence around the building and has he secured it? Are there any green areas, parking, storage areas and easy access to the project?

• Administration/Common expenses – A serious disadvantage for a holiday project is its administration after the delivery. A general meeting of the residents is almost impossible, owing to its seasonal usage, and under the circumstances it is advisable to look for projects, the administration of which has been undertaken by the contractor himself for, at least, a 5-year period. From our experience we have observed that if this arrangement is not done, you would most likely be in an environment of unknown to you buyers, who probably would not be very cooperative, thus leading to catastrophic consequences for your investment.

• Research on Buyers – Unfortunately some of us (mainly Cypriots) do not behave as owners of a joint property and this is particularly noticeable in the case of holiday homes. Therefore a “research” on the others that have bought houses in the project you are interested in, would probably be good for you. We have to admit that 90% of the foreign buyers behave perfectly.

• Prices – Prices show a constant increasing trend, excluding Paphos where prices have shown a downfall by 10% (which is due to the fact that demand by foreigners has been reduced by 20% during the years 2004/05.