Cyprus Property Looks Set to Become an even Better Bet

Always popular, Cyprus property looks set to become an even better bet with the adoption of the euro and the start of budget flights to the island. Tricia Willis finds out what is available for the British buyer.

The Cyprus property market is well established with a unique blend of buyer attractions.  The recent adoption of the euro in January 2008 will surely broaden opportunities for investing in property in Cyprus, while current property price tags stand at around 30 per cent less expensive than other popular European destinations. 

A pleasingly low crime rate and a thriving community spirit combine with high standards of infrastructure, medical care and schooling, not to mention the beautiful beaches, some of the cleanest in Europe, which are bathed in 340 days of sunshine a year. Exceptional tax savings are furthered by a more affordable cost of living than the UK, while the British based legal and banking system, driving on the left and widely spoken English ease the buying and settling-in process and afford those from the UK buying Cyprus property the prospect of a home from home familiarity.

Over 60,000 British homeowners in Cyprus currently capitalise on these kaleidoscopic benefits, with the latest market statistics highlighting a burgeoning strength. From January to December 2007, the BuySell Home Price Index recorded a total increase of 19.2 per cent compared to a total increase of 6.6 per cent during 2006, with the average home costing around £140,000. However, those thinking of buying Cyprus property should also be aware of the distinction between new build and resale markets.  According to Property Frontiers' Where to Buy Property Abroad - An Investor's Guide 2008: "The market is based on new-build properties, and new developments are constantly being built. Consequently, once you have bought a property in Cyprus, you will find that the price of an identical off-plan property development will have risen by perhaps 40 per cent in two years; however, the apartment bought new-build two years earlier will not even have a resale value equal to that at which it was purchased. The vendor will be competing against brand new properties sold by developers, and will therefore have real problems selling."

In light of this situation the resale market appears to favour long-term investment, while short- to mid-term investors are advised to buy property property in Cyprus with a clear 'wow' factor that will be in high demand at all times. Above all, the Cypriot property industry is perfectly suited for holiday-home buyers. A recent survey by holiday-rentals.co.uk showed the average rental period to be 18 weeks per year providing a 6.3 per cent return on investment based on an average purchase price of £134,000 and rental rate of £470 per week. Short-term rentals can easily be achieved from March to October in popular coastal towns, though the Cypriot government's plans for a number of upmarket marinas and 11 new golfing projects suggest a stronger year-round future. Flight increases are also promising, with EasyJet commencing flights to the island in May this year, and Property Frontiers' guide highlights that tourist figures are set to reach 3.5 million by 2010.

Property in Famagusta District
The infrastructure and facilities in the villages around Famagusta are being continually upgraded, with the allure of the island's best sandy beaches also drawing in Cypriot second-home owners, thus offering an integrated lifestyle to new British residents.  Though less popular than its southern coastal counterparts, Famagusta property prices are not to be sneezed at. A resale four-bedroom, four-bathroom house with private pool and mountain views in Vrysoulles available through BuySell, carries an asking price of just €384,434 (£287,000) with features including a fireplace, gazebo, covered garage for two cars, pressurised water systems and an automatic irrigation system for the mature garden. 
 

Property in Ayia Napa
Once hailed as the island's party town, the Ayia Napa authorities have gone to great lengths to establish an appealing family atmosphere. The emergence of larger family homes is testimony to this. Ayia Thekla is not only a popular location for such new developments, but is also the planned site for a large marina. The Ionian complex located in Ayia Thekla is only a few minutes from Potamos fishing harbour and only ten minutes from restaurants, pubs and supermarkets. Comprising a variety of luxurious three- and four-bedroom, sea-view villas and bungalows, the three-bedroom units start from €463,065 (£346,000) through Parador Properties. 

Property in Larnaca
"Larnaca is still considered the only town in Cyprus where property prices have risen steadily by eight to ten per cent a year," says Litsa Chrysostomou, marketing manager at BuySell Real Estate. Major upgrades to the town's road network are being completed and plans continue for a new yacht marina, a new port for cruise ships and an extension of the well-known Finikoudes Promenade with its cobblestones, palm trees, five-star hotels and seafront cafes and restaurants. Maximising the expected demand, a new €650 million (£485 million) terminal at Larnaca airport, due to open in 2008, will increase initial capacity from five million to 7.5 million and up to nine million by 2013, with rumours that Ryanair is to establish routes within six months. 

Yet the most talked about development has to be the proposed luxury PGA golf resort planned on the edge of Tersefanou village. For those who cant afford Larnaca property within the resort itself, the growing number of developments in nearby villages will cater well for the expected high demand.  Parador Properties is offering just such a complex. Residence Oasis Apartments has mountain and sea views with communal pools and green areas.  The apartments feature spacious living rooms, large bedrooms, en suite shower rooms and large balconies, all with private parking and storage. One-bedroom properties start from €94,333 (£70,400), with two-bedroom units from €145,818 (£109,000).


Property in Limassol

Cyprus's second-largest city, Limassol offers a cosmopolitan business, entertainment, dining and shopping experience that lasts all year round. Add to this the seemingly endless stretches of beach and the presence of a ferry port and large marina, and it's easy to see the bustling appeal. Blending the best of both worlds, the myriad traditional villages stretching inland are soaring in popularity, as buyers seek an authentic home within easy reach of city life. A resale, stone-built, two-bedroom Limassol property in the traditional village of Asgata village has mountain views and a sale value of €215,264 (£161,000). It is currently on the market with BuySell Real Estate.
 

Property in Paphos
For discerning buyers seeking optimum investment, Paphos property is the one to buy  Plans for a new marina in the suburb of Coral Bay are expected to be announced imminently, with two luxurious, self-contained resorts capping the town's elite property offering. 

The first is Elysia Park by Pafilia, the developer who gained Silver awards in the Best Apartment and Best Villa categories at the Homes Overseas Magazine Awards 2007. Located in the heart of Universal, the most lucrative tourist investment area for the past six years, Elysia Park's hallmarks are undoubtedly its unparalleled park-like grounds and unrivalled facilities. A fully equipped business centre, the largest gym and heated indoor pool in Paphos, spa facilities, basketball court, two outdoor infinity pools, two children's pools, and playgrounds are accompanied by ten custom-built shops, with permanent on-site staff and 24-hour reception. Comprising 304 apartments in total, the first phase is due for completion in December 2009 and the second in May 2010. Prices start from €299,000 (£223,000) and are expected to soar dramatically.

The second resort, St Nicholas by Alpha Panareti, was Homes Overseas' Gold winner for Best Apartment in 2007. Bordering Chlorakas village, just a ten-minute drive from Paphos town centre and five minutes to the beach, the resort is made up of 200 apartments, due for completion in March 2008. Boasting a clubhouse with indoor pool, Jacuzzi, gym and sauna, a restaurant, a cinema room, children's playground, four outdoor pools, a tennis court and 24-hour management staff, all properties were sold within six months of their May 2005 release. With only resales now available, having accrued a 30 to 61 per cent increase in value, the current prices are around €160,000 (£119,000) for a studio apartment, €230,000 (£172,000) for one bedroom and €300,000 (£224,000) for two bedrooms, all fully furnished.

Buyers seeking to capitalise on a similar off-plan investment should keep their eyes on Alpha Panareti's development of 500 sea view apartments, Terra Divina in Kouklia, launched in February this year. One-bedroom properties are for sale from €220,000 (£164,000), two-bedroom units from €275,000 (£205,000) and three-bedroom apartments from €340,000 (£254,000), with the price inclusive of furniture, appliances and interior design, even covering the first year's management committee costs, plus the rental and maintenance fee. 

Alpha Panareti's managing director Andreas Ioannou, says: "Our success is due to a combination of factors.  We offer exceptional architecture and facilities. Our rental department is signed exclusively to ROPUK Network in the UK, while our on-site, non-profit management committee acts like a five-star hotel service for clients. We also offer exclusive mortgage rights with a local bank. A mortgage of €171,000 [£128,000] typically costs €1,250 [£934] in monthly payments, but with Alpha Panareti these are reduced to just €920 [£687], creating savings of €99,000 [£74,000] over a 25-year period." 


Property in Latchi and Polis
With its secluded beaches, traditional villages and vast unspoilt Akamas nature reserve, the north-west tip of the island offers an unrivalled pastoral escape. Indeed, high spenders will find the region is positively brimming with luxurious homes. Amoroza Villas by Pafilia offers an enviable address, located on the beachfront of Latchi set against the mountainous backdrop of the Akamas Peninsula.  The exclusive community of 25 three- and four-bedroom villas are set on individual plots ranging from 515 square metres to 1,118 square metres, with property sizes ranging between 183.75 square metres and 296.90 square metre. Open-air terraces and impressive infinity pools create fine al fresco living, with the generous living space encompassing reception rooms with fireplaces, saunas, gymnasiums and treatment rooms, with exceptional finishing touches. Prices start at €1,042,000 (£778,000), with a completion date of March 2008.
 

First published in April 2008.
Some information contained within this article may have changed since it was first published. Homes Overseas strongly advises you to seek current legal and financial advise from a qualified professional.