Buying a property in North Cyprus as a foreigner
What you should know before buying
If you are interested in buying a holiday property, your retirement home or a good investment property in North Cyprus, then you should read this article.
The real estate in North Cyprus is experiencing a boom, because North Cyprus is so slowly recognized by many other countries. But also because the real estate prices are still cheap and many investors from all over the world are now interested in the north side of the island. There are already many nationalities that have found a home in North Cyprus. Many entrepreneurs, stock traders, Bitcoin professionals, coaches, retirees and even workers in the medical field already live in North Cyprus and practice their worldwide business from there.
Why don’t you? We’ll show you exactly all the steps. We work with lawyers and tax advisors from Germany, Austria, Switzerland and England, plus local professional service providers on the ground and we work directly with the developers. There are no brokers and additional fees in between. Our mission is to provide honest advice and support. For every step we provide you the professionals. All our customers are very satisfied so far. Transparency and high quality services are our motto!
Northern Cyprus is becoming increasingly popular with Germans, Austrians, Swiss and Scandinavians who have wanderlust and want to fulfil their dream of owning a flat or house in the sun. From our own experience, you should consider many criteria when buying a property for investment in North Cyprus.
Step 1: Find the right property
Whether you are looking for an investment, a holiday home or a retirement home for your own use or to rent out, it is important to find the right offer for you.
In general, you should answer the following questions:
- Do I want a detached house (mostly resale, unless new build) that I have to worry about maintaining?
- I would like a house or flat within a residential complex where I have all the communal amenities close by (pool, gym, spa, restaurant, playground) and their care is taken care of?
Step 2: Find the professional property developer
When it comes to a new building, it is important that the developer delivers what he promises. It is essential to find out in advance which developer is trustworthy, liquid and of high quality. There are many building companies in North Cyprus, but only a few that meet European quality standards.
Step 3: Find trusted local partner
In North Cyprus, all your interests will be represented by reputable partners and lawyers. It is essential to have a local partner with integrity, who understands the European mentality and approach.
Let’s assume you have found your dream property. Of course, like everywhere else, there are different scenarios. Private, commercial, new construction or resale. For simplicity’s sake, I’ll use an example of how it actually was with a client this year.
After an intensive analysis of the offer, we took a new property, called “ORCHARD” Off Plan, directly from the developer into our portfolio in summer 2021. This means that based on plans and a presentation, we decided to recommend the property to interested clients. The construction of the property has already started and should be ready in early 2022. We were also directly on site and saw the construction and requested and analysed all documents from the developer.
However, the offer would still have to be legally examined. So our partner lawyer came into play. The lawyer, who specialises in real estate law, was involved in every step of the process. He confirmed that the construction was compliant and that the documents were also correct. The price and payment plan were also right and the offer was even a bargain. So we started recommending the property to interested clients.
First of all, something about the pricing. Caution: It is extremely unusual to negotiate the price in North Cyprus. What is negotiated, or rather agreed upon according to the interests of the buyer, is the payment schedule. In general, the payment schedule is relatively flexible and depends on the developer. Because we introduce the clients directly to the developer, the negotiations are transparent.
Finally, the lawyer comes to check the offer again. He or she is present at all agreements, meetings that take place with the developer to record any agreement in the contract. This can include, for example, an informal agreement such as keeping a dog. Once all agreements have been formulated, the corresponding contract is drawn up by the law firm. It is important to mention here again: The lawyer always acts in the interest of the buyer.
For our prospective buyer from Germany, we have first reserved the property for 1,000 pounds for 1 month. When he came to Cyprus in September, we organised the airport transfer and free accommodation for 3 days in Northern Cyprus.
We visited the property together the next day with the developer. The client was able to view his future 2+1 flat on site and ask questions directly to us or the developer. Everything met his expectations and he decided to sign the purchase contract. On top of that, thanks to the friendly conversation, he received all the electrical appliances free of charge from the developer. This is not usual but in North Cyprus anything is possible. Some developers are simply generous.
The contract was drawn up and we had it checked by the lawyer. A few hours later we got the OK from the lawyer. After a delicious lunch in a nice restaurant in Long Beach next to Famagusta, we drove together back to the developer’s office where the documents were already waiting for the client.
Step 4: Signing of the contract
Once the draft contract has been approved by both parties, it is signed. The contract is divided into two languages in two adjacent columns. English and Turkish. Meanwhile, German copies are also made because so many Germans on the island have also bought.
Since Turkish is the official language in North Cyprus, this means that every official document must also be written in Turkish. Each page of the contract, including all annexes, is signed in triplicate. By the buyer, seller and a witness in our case, the lawyer. Unlike in Germany, the notary only comes into play later.
So once all the pages are signed and stamped with the appropriate company stamps, the copies are divided between you, the developer and one copy stays in the office.
The usual deposit amount to be paid to the seller when signing the purchase contract is 30% of the purchase price. This ensures that the buyer is serious and until this sum is paid, the purchase contract will not be officially registered in the land register.
According to Turkish Cypriot law, contracts must be deposited with the land registry within 21 days of conclusion. Here, the “stamp duty” of 0.5 % of the purchase price is paid to the Tax Office. This is usually paid together with the down payment.
To illustrate this with a concrete example. You buy a penthouse for 200,000 Pounds. All property prices are traded in pounds, as the TRY is subject to strong fluctuations. With a sales price of 200,000 Pounds, this corresponds to a 30% deposit of 60,000 Pounds and a Stamp Duty of 0.5%, 1,000 Pounds. This total of 61,000 Pounds is then paid to your solicitor. You realise. Everything here really goes through the lawyer.
Step 5: Registration of the property
As soon as the payment is received, the contract of sale is registered with the Land Registration Office. This protects your property from being sold to a third party, for example, and the contract takes precedence over any subsequent encumbrance.
This whole step in the process is done for you. This is all included in the legal fee paid, which, by the way, ranges from 1,500 to 1,800 pounds.
The approval process can take up to 6 months. However, this does not prevent you from moving into the acquired property, renting it out or even selling it. The law firm ensures that the contract is assignable.
Once permission to purchase has been granted, all the necessary valuation forms are completed for the valuation of the property. The taxes due on the transfer of the property are paid and the title deeds are registered in your name.
And that in itself completes the buying process.
Do you want to invest in North Cyprus?
Its time to buy a property in North Cyprus. If you need any help by planning your holiday and at the same time would like a property viewing tour in North Cyprus, please contact our professional team or simply email us at: info@cyprus-investment.com
