Buying property in Cyprus is one of the investment options that expats should think about when moving to the island. Cyprus is one of the most beautiful islands in the Meditteranean Sea that hides many opportunities for people that choose it as a place of residence.

Despite its small size, Cyprus combines the hot Med weather with an excellent set of services in the financial and tourism sector that are among the top in the European Union. Many large companies move to Cyprus, transferring personnel that should rent or buy a home there. Therefore, the demand has increased significantly, especially after the war between Russia and Ukraine started in February 2022. 

Things to know about the Cyprus property market

Although Cyprus is one of the smallest countries in Europe, its property market has been blooming for many years now, driven by high demand and low interest rates. Despite the reported increase in prices, the Council for Registration of Real Estate Agents has stated that the Cypriot housing market is not experiencing a bubble at the present time.

According to the Central Bank of Cyprus Q4 2021 property index, residential property prices rose by 1% year-on-year for houses and 6.3% year-on-year for apartments. In total, the market experienced price increases of 2.6% year-on-year, lower than Cyprus’ GDP growth over the same period of time.

The Council for Registration of Real Estate Agents notes that “according to the Central Bank Property Index, prices are still much lower than those of 2007, when they reached their peak, but also compared to 2010 or 2012, if we want to go back a decade. The real estate market has shown strong resilience during the pandemic and in this new period of uncertainty.”

Where should you buy property in Cyprus?

Cyprus has been a divided island since 1974. The southern part of the island belongs to the Republic of Cyprus, whilst the northern part belongs to the so-called Turkish Republic of Northern Cyprus (TRNC), which is not internationally recognised. Therefore, buying property in the northern part may prove to be problematic as negotiations for many issues, including properties between the sides, have been fruitless for almost 50 years. 

The Republic of Cyprus is divided into the regions of Nicosia, Limassol, Larnaca and Paphos. Each region has its own perks with 3 of them giving you direct access to some of the most beautiful beaches the Med has to show. There are many affordable homes for most budgets, but we should note that each region has different prices depending on demand and supply. 

Property in Nicosia

Nicosia is the capital of the Republic of Cyprus. Unfortunately, it is the last divided capital in Europe since 1974. In the city’s centre, Ledra Street is a pedestrian street lined with restaurants, bars, and cafes that end at a popular Green Line crossing point. Nicosia is home to most government services and many international companies such as Mindgeek, Wargaming, KPMG, Deloitte, EY and others. 
Nicosia is an excellent choice who love city life. Apartments, in particular, have seen a surge in interest from both Cypriots and non-native buyers. Many Ukrainian and Russian enterprises have recently expressed an interest in coming to the island, contributing to the influx of highly skilled workers and property buyers. 

One bedroom apartment prices in Nicosia start from 125,000 euros in case you want to buy and 550 euros if you want to rent one in the city centre. However, the Nicosia region has many small villages, no more than 15-20 minutes drive, where you can find lower prices and larger detached homes. 

Property in Limassol

Limassol is a cosmopolitan city with a superb selection of international schools. With numerous shops, restaurants, bars, and entertainment venues to choose from, you will find everything you need to live a comfortable life. Furthermore, if you want to rent out your property to tenants, you’re lucky; Rentals are currently in short supply in Limassol due to the limited availability and rising demand.

However, living in Limassol is more expensive than in other parts of Cyprus. Buying a one-bedroom apartment starts from 170,000 euros whilst rent for a similar apartment starts from 700 euros, depending on the age and amenities. 

Property in Larnaca

Larnaca hosts the island’s largest international airport and is close to many popular locations for expats and tourists. The famous sandy beaches of Ayia Napa and Protaras are just a 30-minute drive from Larnaca, ideal for spontaneous excursions. 

The newest addition to Agia Napa’s amenities is the Ayia Napa marina, which according to the relevant website, “it is an international lifestyle destination of choice for visitors seeking luxurious residences, world-class yachting facilities, carefully curated retail and dining options as well as bespoke recreational and entertainment experiences.”

The Larnaca region is home to a well-established expat community. Many foreign nationals like to spend some months during the year here, enjoying the delicious food and amazing beaches. Potential buyers should know that Larnaca still hides many property opportunities whilst being cheaper than Nicosia and Limassol. One-bedroom apartments start from 90,000 euros whilst renting one would cost around 450 euros.

Property in Paphos

Paphos, a city on Cyprus’ southwest coast, is home to the majority of British expatriates. There are numerous cafes and stores to explore in Paphos’ charming Old Town, as well as numerous old ruins. Aphrodite, the goddess of love, is said to have been born near Paphos in Greek mythology, which may explain why so many foreigners fall in love with the region.

Paphos hosts the second international airport in the Republic of Cyprus, with regular flights to almost every UK airport as well as other European destinations. The region of Paphos is home to many exciting attractions such as the Baths of Aphrodite, numerous wineries, and the largest forest in Cyprus and the Acamas peninsula. Thousands of Brits have chosen Paphos to have their permanent residences there. 

If you would like to buy a one-bedroom apartment in Paphos prices start from 90,000 euros. If you would like to rent one prices start from 450-500 euros. We should note that the Paphos region is the cheapest when it comes to property prices, but stats have shown that there has been a spike in the last year. 

Holbon Assets Cyprus helps expats invest in property

Holborn Assets is a financial services provider founded in Dubai more than 20 years ago. Since then, we have expanded to more than 15 countries and 23 offices around the world. Holborn Assets has established a base in Limassol and Paphos, aiming to serve expats who have chosen Cyprus as their residence. 

Investing in property is one of the safest moves you can make if you want to diversify your portfolio. Furthermore, buying property safeguards your family’s financial future as it can be a steady source of income. Buying property equals tax obligations, the need for foreign currency exchange to complete the purchase and other actions you might not know. 

Our experienced and fully qualified team of financial advisers in Cyprus is ready to help you by providing sound financial advice regarding taxes, currency transfers and many other services that would help your portfolio grow. Get in touch with us by using the contact form now!

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Fixed rate, tracker, standard variable – todays mortgage market has more products than ever and finding the right one requires extensive research. Remortgaging is no different, it requires careful consideration.

In a nutshell, remortgaging is where a new mortgage is taken out to either replace your current mortgage or to borrow money that is secured against your property.

As an expat looking to remortgage a UK property there are some things to be aware of.

What are the benefits of remortgaging?

Remortgaging can potentially save you thousands a year. Shopping around for a better deal is something people do with their phone contracts but might not consider when it comes to their mortgage.

Like other lending products, banks usually offer an introductory fixed rate on their mortgages. These are sometimes referred to as headline offers and they can last anywhere from two to five years.

Once the offer has ended your mortgage will usually revert to the lenders standard variable rate. This will more often than not be a higher rate than what you were paying and can increase monthly repayments.

The benefits go beyond savings. Let’s say you have just been offered a job abroad, you might be wondering what happens to your UK property and your current mortgage.

Switching to a buy-to-let mortgage is one option for expats who want to rent out their property while they are overseas for a long period. Remortgaging to a different mortgage type isn’t something to rush into and it’s best to speak to an independent financial advisor before making a decision.

Remortgaging can also give you flexibility. A mortgage that suited your financial situation when you took it out may not be the best fit now. If your salary has increased and you want to up your monthly payments, or even pay off the remainder of the mortgage, you might be restricted.

Some lenders will have an early repayment charge and the ability to increase your monthly payments may be limited. Remortgaging can help you secure a more appropriate deal for your current situation.

What are the drawbacks?

Earning a salary in a currency that isn’t pounds sterling can cause problems with some UK lenders which is why expats may consider an off-shore lender.

One of the main advantages of using an off-shore lender is your salary currency won’t be an issue.

If you do go with a UK lender, be aware that checks are more stringent than they used to be due to changes in the industry. The FCA introduced new rules in 2014 in an attempt to stop people taking out mortgages they couldn’t afford. The mortgage market review (MMR) outcome means that lenders must now ask for proof of income and plans for repayment. This includes a review of not just repayment at the introductory rates but also higher rates.

With these changes there is a chance that you or your partner no longer meets the lenders criteria for remortgaging. Being rejected by too many lenders will ruin your credit score and make borrowing in the future more of a challenge.

The amount left on the mortgage should also be a consideration. Some providers in the UK will not take on a mortgage of £25,000 or less, and if they do the fees may outweigh any savings you would make.

You have decided to remortgage, what’s next?

Switching to a new lender can take up to two months so start early and explore your options.

Some UK lenders will allow you to secure todays rates but start the repayments up to six months later. This allows you to protect yourself against rate increases that may be introduced by the bank in the near future.

Checking your credit rating should be a priority. Money Saving Expert suggests polishing your credit score before approaching lenders to reduce your chance of being turned down. If you are turned down, work on improving your credit score rather than going to another lender only to be rejected again. Remember, too many rejections will have a negative impact on your credit rating.

With a healthy credit score it’s time to sort out your finances. Speaking with an IFA can help you get your finances in order – this is something a lender likes to see when they make a decision.

A final word on rates.

We touched on the potential savings to be had by remortgaging and avoiding hikes in interest rates. Increases to rates set by the bank are different to those influenced by the Bank of England.

If you go with a UK bank then bear in mind that the interest rate set by the Bank of England heavily influences the standard variable rates offered by lenders. For example, if the rates set by the Bank of England have increased during your fixed term, you may want to consider other fixed term options to avoid the variable rates.

Our expert mortgage advisors can help guide you through the potentially tricky process of remortgaging. If you would like some more information specific to your circumstances you can reach us by using the contact form below.

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