Why North Cyprus presents a unique opportunity for the Property Investor.
Keep updated with latest investment opportunities...
There has been some confusion and misinformation regarding investment in North Cyprus with several companies and articles declaring the area un-wise for investment because of the possibility of the investment becoming worthless in the even of land disputes over correct lineage. Typical statements are similar to the one below:
"When a settlement to the division of the island comes, as it will, anyone who has bought a property without correct lineage - for example one that should rightly belong to the Greeks - may well find themselves with an investment that is worthless . "
Learn more about land titles in North Cyprus Here.
This information is actually not accurate and misleading. There was an international adjudication under the Annan plan in April 2004 which was accepted by the Turkish side in a referendum and rejected by the Greeks. This will form the legal basis for any future settlement and means Greek Exchanged land (Esdeger) will have no compensation paid by either party if the exchange was done correctly and Expropriated Greek land by the TRNC government will have a compensation based on the 1974 land values plus interest. In most cases this is likely to be 2 or 3% of the current property value. The only possible threat (under human rights law) would be for someone to buy a Greek property in the North that was built and occupied prior to 1974 as opposed to buying a property subsequently built on farm land that has no prior occupation rights.
As with any property purchase there are costs associated with the acquisition of a property. You can read more about the costs and taxes in North Cyprus here.
We can organise viewing trips for clients wishing to travel to North Cyprus to view available property. All travel arrangements can be taken care of at preferential rates including flights, hotels airport transfers and accommodation. You will be met by our partners in North Cyprus and shown the required property at the same time have any questions answered. E-mail: firstname.lastname@example.org for further information.
If you have already decided on a property and wish to reserve it in advance, we offer a special viewing trip. For a reservation fee of £1000, which will count in full as a deposit on your home, we will fly you and your partner to North Cyprus and provide 3 nights hotel accommodation, local tours and inspections.
The article below was independently written by Rebecca Short and offers an excellent insight to North Cyprus Investment:
Article Title: North Of The Border
Author: Rebecca Short
“There is a hope and, more importantly, a genuine desire for the Cypriots to want a resolution,” says Pauline Gallagher of Halcyon Properties in the South. “This in itself presents a very good opportunity for agents in the future as the North of the island starts to enjoy some of the prosperity of the South.”
Much has been written about the hasty partition of Cyprus : a bloody irruption born out of years of ethnic tensions that left a paradise isle bruised and divided in 1974. Simplistic summaries in the aftermath have done little to fully capture the torment of the islanders and that a 1,000-strong UN Peacekeeping Force has had a presence here since 1964 suggests a dispute with long, deep roots. Certainly unbiased historical accounts of the conflict are a scarcity such is the emotive legacy of blame. What is indisputable is the outcome: an island sliced into two de facto autonomous segments.
Thirty-one years on and the internationally recognized Cypriot Government in the south and Turkish-Cypriot community in the north remain divided by a ‘Green Line' that symbolises the island's unresolved cultural friction. Today a Turkish Cypriot community roughly the size of Orpington is isolated geographically, politically and economically: an exiled land of 18 per cent of Cyprus ' inhabitants where the average wage is just above £3,000 per annum.
In contrast to the fragile fiscal fortunes of its neighbours in the North, the Greek-Cypriot South has positively boomed. By the time the Turkish-held area declared itself the Turkish Republic of Northern Cyprus in 1983 (a status recognized only by Turkey ) the Greek-Cypriot community had already begun to reap the rewards of its flourishing tourism industry. Polished infrastructure and a sizeable international flight schedule saw visitor figures soar while the TRNC's largely undeveloped 3,355 square kilometre landscape told an altogether different story. Piles of ruins, deserted villages and rubble gave it a hangdog look of rejection and neglect with businesses that suffered the depression to match.
Yet things are changing in Northern Cyprus thanks to a spurt of sudden transformation at lightening speed. Until a year or so ago the economic growth of the North had been volatile at best, an inevitable consequence of relative isolation, a bloated public sector and reliance on the Turkish lira. Yet in 2004 the sluggish Turkish Cypriot economy grew by encouraging 2.6 per cent, a celebratory figure fuelled primarily by a burgeoning construction sector. The TRNC embraced this modest milestone with considerably gusto, announcing plans for developing its tourism potential in the wake of relaxed border restrictions with the Greek Cypriots.
British expatriate in Famagusta , Marion Northfield agrees: “There is an air of real optimism ahead of the UK taking on EU presidency. Both sides of the island feel sure that the next six months will be a critical time for finding a solution, especially in a year when relations between Turkey and Greece have never been better. The Greek PM is due to visit Turkey for the first time in 46 years. And with the borders open there is a greater understanding and respect between the communities. These are all the right ingredients to finally reach a fair and just settlement for all Cypriots island-wide.”
However, the failure of the latest two-year round of UN-brokered direct talks between the leaders of the Greek Cypriot and Turkish Cypriot communities has been a serious fly in the ointment for the TRNC. These protracted and highly sensitive discussions aimed at reaching an agreement to reunite Cyprus came to an abrupt halt following the rejection of the UN settlement plan by the Greek Cypriot South in an April 2004 referendum. It was a bitter blow to the aspirations of the North who had made little secret of its enthusiasm for a united EU entry. And so it was that the Greek Cypriot-controlled Republic of Cyprus joined the EU on 1 May 2004 amidst much tit-for-tat sniping regarding the South's opposition to EU efforts to establish direct trade and economic links to North.
“Since the Greek Cypriot “no” vote the Turkish Cypriot community has been assured steps will be taken to lift trade embargoes,” explains Tony Hamit of UK agent North Cyprus Property. “This will lead to direct flights and a massive investment in tourism and development – and will undoubtedly further growth in the real estate sector.”
For now, at least, Northern Cyprus has resigned itself to prosperity via its two key potential markets, the construction and real estate industry and international tourism. Wide, open spaces and striking views have given each a boost and when the Green Line opened for the first time in 30 years in 2003 more than 17,000 people crossed the border in just three days. Though many had heard about the unspoilt beaches, sleepy villages and undisturbed countryside in the North, few had prepared themselves for the attractiveness that isolation and under-funding can bring.
“Large areas of Northern Cyprus remain completely untroubled by development and our biggest sector is British tourists at more than 100,000 a year,” explains Yilmaz Kalfaoglu of North Cyprus Tourism. “Visitors love our beautiful beaches, ancient monuments and historic harbours and we're proud that Northern Cyprus is one of the fastest growing destinations from the UK . Visitor figures were up by 40 per cent in 2004 from 2003 while growth so far this year is currently at 26 per cent.”
Tourism efforts look set to be furthered by a grant of 249-million Euros that has been agreed by the European Union but has yet to be put in place. Preparations are also being made to upgrade accommodation. New projects are planned and the current number of rooms will be doubled with a total of 5,000 new rooms added during 2005 and 2006.
Much of the large-scale property development has been concentrated in the Kyrenia (Girne) area in the west of the Northern territory , although small pockets of construction form a necklace along the route from Famagusta (southeast) up to the Karpaz Peninsula in the northern tip. Much of it is aimed at the holiday home market and many buyers are British – there is even a British Residents Association in Kyrenia not to mention umpteen fish & ship restaurants and several great British pubs.
“The number of expatriates is rising year-on-year with Kyrenia a popular place to retire or own a holiday home, “explains Tony Hamit. “When compared like-for-like property prices are much more affordable in the North. A 3 bed detached luxury villa with private pool and sea and mountain views comes with a £115,000-£150,00 price tag in Kyrenia. It'd cost more like £260,000-£385,000 in Paphos or Limmasol in the south.”
As it stands there are few restrictions governing foreign ownership although property sales and land acquisition remains a vexed situation. The TRNC's unrecognised status can be problematic for dealmakers, while the onset of land wrangles and legal challenges are subject to constant rumour and speculation. At the heart of the dispute are the claims of those who were displaced by the division of the island. As people fled to safety in both the North and the South of Cyprus the abandoned homes and land became a highly contentious issue.
Today Greek-Cypriots inhabit 63 per cent of the land and the Turkish-Cypriots the other 37 per cent, although the UN's plan supported reapportioning several chunks of the island. However with the two sides currently unable to agree on the details dozens of ownership disputes abound, as claimants from either side seek to reclaim their land more than 31 years down the line. Given that the original figure of 170,000 Greek Cypriots now totals approximately 220,000 including children, the potential scale of this bitter dispute is no small squabble.
“Claimants in the South have been heartened by two European Court of Human Rights judgements that supported the rights of Greek Cypriot property owners,” explains Yeliz Hamma an analyst at EMU. “But it was the legal challenge before the Courts of the Republic of Cyprus that really grabbed the headlines. The suit filed by Meletios Apostolides against British couple, David and Linda Orams, sent shockwaves through the expatriate community in the TRNC.”
The Orams had built a holiday home on land that Apostolides abandoned during the troubles of 1974 and, as predicted, the Cypriot Court agreed that he is the legal owner. In November 2004 it ruled that the couple should demolish the house, return the property to Meletios Apostolides and pay him damages of £7,654.83 plus £294.41 per month until the situation is was fully resolved. Yet despite this robust court battle many agents in the TRNC remain upbeat and undeterred, according to Tony Hamit from North Cyprus Property.
“In the last thirty years there hasn't been an estate agent, developer or end buyer that has lost possession or title to land or property – although a lot of publicity recently has suggested otherwise,” he explains. “The action brought against The Orams centred on a claim from a previous owner. However the jurisdiction of the TRNC is totally independent of that in the South and we're confident this judgement is unenforceable and therefore irrelevant. In my opinion this was simply a high-profile attempt by the South to discourage the property boom in Northern Cyprus .”
More than fifty British real estate agents currently sell TRNC property and staff at Harlequin Property, Unwin Estates, North Cyprus Property and Sunny Property each report brisk business. However, property professionals that contemplate selling real estate in the TRNC can find the issues complex and loaded with potential fall-out. The political ramifications associated with the trade in occupied land are far-reaching and in recent years Greek-Cypriot agents have made little secret of their vehement opposition to those that choose to do it.
This group of lobbyists are a well-organised and vocal bunch with considerable commercial clout. Many agents in the north admit to “getting quite a lot of flack” while a number of UK overseas property magazines that have carried TRNC ads have been threatened with a withdrawal of advertising from Greek-Cypriot clients. Property journalists that have written about Northern Cyprus have been on the receiving end of strongly worded letters, while in 2004 a property exhibition feared a Greek-Cypriot boycott after tempers flared on learning that agents from the North were also plying for trade.
Another factor that can overshadow any amount of glossy marketing is the press coverage the South-North property haggle receives. In June 2005 an article in The Guardian bleakly warned of the growing “acrimony on the island” while at the hands of Sir Trevor McDonald on his ITV ‘Tonight' show, potential buyers in the TRNC were warned of “significant risk”. Another fierce critic of agents in North Cyprus is the Cyprus Government, which issued a statement to the property industry in April 2005 in a bid to clarify its stance. Spokesman Kypros Chrysostomides reiterated that “Greek Cypriot owners cannot be deemed to have lost their legal title to their properties as a result of the occupation and have always remained and will continue to remain the only true and lawful owners.” In full it pulls no punches: a good thing, according to Pauline Gallagher of Halcyon Properties, who insists that is the duty of every agent to be ethical and accountable, especially when it comes to contested land.
“Any agent considering selling property in the north of Cyprus should look beyond pure commercial gain to consider the far deeper moral and emotional issues that exist on this divided island,” she suggests. “Legal precedents in both Cypriot and European Courts have ruled in favour of Greek Cypriots right to land ownership. Arrest warrants have also been issued to agents selling in the north. If it is proven that a client has purchased a property on land owned by a Greek Cypriot another consideration is that it may be easier to sue the agent in the UK rather than to fight through the Cypriot courts.”
However, despite these risks demand for real estate remains high in Northern Cyprus where the cost of living is considerably lower than in the South with some everyday items priced at up to 60 per cent less. Property values are up a whacking 55 per cent on 2004 figures and agents report no sign of slowdown. Sure, shopping tends to be a less sophisticated affair thanks to a notable absence of Brit favourites, Next and M&S - but relaxed trade restrictions offer promise. And with some off-plan developments experiencing a 70 per cent increase in value, Tony Hamit is convinced the TRNC property market has much to offer agents, including higher commission potential than the South.
“Agents can earn anywhere between three and 10 per cent in the South but this will drop as the market becomes regulated. In the North commissions are more like five per cent on property sales and 15 per cent on rentals. In my opinion it's a buoyant market for investors and speculators and an attractive prospect for consumers – a good reason why Northern Cyprus has been tipped as one of the top ten places in the world to buy property.”
Find out about the latest investment opportunities as soon as they are available
A selection of our latest opportunities
We have an assorted array of opportunities including buy-to-let, rental & bonds
Get the latest property and investment opportunities direct to your inbox for FREE (you can unsubscribe anytime)
Cyprus House Prices fell 1.8% in Q1 2018
Cyprus Property Market is booming
Running a Business in Cyprus
Paphos and Akamas Peninsula
Lawyers in Cyprus
Starting a Business in Cyprus
All property news from Cyprus
Subscribe to our RSS Feed
Subscribe to our newsletter and keep up to date with the latest and best investment opportunities around the world!