Am I Too Late for investment in Cyprus?,

[andre]

Hey Guys,
Having recently been out in Cyprus on holiday, I?ve looked at the possibility of buying property, mainly as a buy to let, but also looking at this as an investment for retirement.
There seems to be a huge boom out there right now, with properties being built everywhere - but prices are also well on the way up - so I?m not sure if we've missed the boat, so to speak, as just a year ago prices were a lot lower.
To cut a long story short, we've found a 3 bed villa, with a pool, about 300m from a beach, and in a popular tourist location. Similar nearby villas are being rented out at peak season for a fat wad of cash. Some quick sums suggest the rental income will pay somewhere around 80% of the mortgage costs after I?ve put down a deposit (my calcs are assuming it will be empty for about 6 months of the year) .

I love the location, and the country, and could really see myself living out there when I chose to retire, and this seems a great way to buy a retirement home over the next 15 years or so.
Interested to here any comments from people who have already done this and failed or succeeded..
Any related advice much appreciated.
Regards
Andre

[andy]

Hi Andre,
Cyprus will crash, there is too much supply, prices are too high and our key overseas market (the English) are staying away in droves.
It's a brilliant place to live, but wait and see what happens before you jump in. I think the downturn will gather pace in 2006 and the first to go to the wall will be the small to medium sized developers.
Keep in touch
Andy

[armando]

Hi Andre,
I live in Cyprus. The market topped last year after a lot of hype about the effects of EU membership. For sure, prices there are in a bubble and are only supported by UK buyers (and to a lesser extent Russians). The local economy cannot support a major property boom with average wages being only 500-ish quid a month.

We are moving out next year. Therte is very limited infrastructure there. My wife complains often about the lack of shopping and our kids likewise about the few leisure facilities. In my view, it's better to go to somewhere like Florida where there are bags of things to do, the infrastructure is top class and there is no language problem. That's where I will be heading when I retire, anyway.
Thank you
Armando

[Kam]

As a company we do offer Cyprus as an option to clients, but i DO NOT let my clients buy into it as i do not believe its investment credability

[InvestmentProperty]

I think the negative responses are not correct for several reasons:

1) They are building 9 new Golf courses, (Talked about 14)
2) There is a new 1000 yacht marina being built in the next 3 year. (The biggest in the east med)
3) Land is having 15% Vat put on next year
4) All new builds now have 15% VAT On them. (We have a selection brand new which don't - The best properties).
5) Rental market in certain parts of the south Cyprus is strong.#
6) Both Paphos and Larnaca aiport expansion the next 3 years.
7) These are just some, there are many other good reasons

+ Obviously joining the Euro will push prices up.

We deal with Investors and none of them seem to thing it is bad to invest, in fact the market is getting stronger and so is a very good country to invest into. We offer a personal 1 to 1 service Investment Property In Cyprus

Originally Posted by Kam

As a company we do offer Cyprus as an option to clients, but i DO NOT let my clients buy into it as i do not believe its investment credability

[InvestmentProperty]

I would like to mention that there is no poverty in the south of the island. You do not get beggars at all. They will survive quite well to start with because we are buying into their pockets. And Cypriot people are not poor.

Investment Property In Cyprus

Originally Posted by armando

Hi Andre,
I live in Cyprus. The market topped last year after a lot of hype about the effects of EU membership. For sure, prices there are in a bubble and are only supported by UK buyers (and to a lesser extent Russians). The local economy cannot support a major property boom with average wages being only 500-ish quid a month.

We are moving out next year. Therte is very limited infrastructure there. My wife complains often about the lack of shopping and our kids likewise about the few leisure facilities. In my view, it's better to go to somewhere like Florida where there are bags of things to do, the infrastructure is top class and there is no language problem. That's where I will be heading when I retire, anyway.
Thank you
Armando

[Pete]

Anyone who tells you there are great investment opportunities in Cyprus must have something in it for themselves!

My wife and I moved to Cyprus 2 years ago and decided to hedge our bets - buy a couple of rentals, buys some off-plan 'investments' and try some renovations. We were given a lot of positive spin by all the estate agents and locals we spoke to and thought we'd done enough homework to not make too many mistakes. However, it wasn't until we lived out here and started renting/dealing with management companies, estate agents, tennants and watched our so called 'investment opportunities' sit stagnant that we realised the truth!

I've written a book on our experiences which basically follows everything we've done over the past 2 years in details - it tells our story in a light humoured way, but contains lots of useful information that we've learnt and hope will help others not fall into a similar situation.

We've just got a website running with information on the book:

Things The Estate Agents Don't Tell You!!

and the book is available off the site or through Amazon.

Hope this could be of some help.

Pete.

[Eelee]

I beg to differ on all this negative feedback - granted prices are going up, all the time and the bubble may burst - but if youre unsure then sell what you have bought before anything happens - the markets not that unpredicatable and while prices are still going up you may even end up making a small profit

[bazza]

We all know that residential property prices are way too high compared to salaries in Cyprus. For us in the UK (and other parts of the world) the prices seem reasonable compared to the type and size of house we own here. Cyprus is a lovely place to live in terms of weather and lifestyle but if you are planning to start a NEW life there and have a mortgage then I would advise you not to move there. It will be difficult to survive. Please consider the following points.

1. Sales in 2006 where down by 50%. Buyers are now investing in other countries where properties are a lot cheaper. A buyer will be influenced by the price and there are a lot of other lovely places just like Cyprus. I was offered a 4-bedroom bungalow (300m2), all en-suite bathrooms, big kitchen, double garage, mature gardens etc, in Florida, built on 500m2 of land, practically next to Disney for £200.000 sterling. This is the equivalent of £170,000 CY pounds. You cannot find anything similar for the same price in Cyprus. You will be very lucky to get a semi detached in a good area for this much.

2. Properties in the North have started to boom. There are adverts everywhere (lots of money put into marketing) and the no vertict of the Oram's case has boosted sales. The non vertict situation from The British court has helped buyers make their mind although it is not settled yet until it goes through the European Court. By that time it will be too late as many sales will have been made. Also, property in the North is a lot cheaper. Does a UK buyer or any buyer care if he lives in the North or the South?

3. Cyprus economy is dependent on Tourism. In 2006 the figures were down (by 21% if not mistaken) and Cyprus has no other big income. Oh yes...sorry. They do have one more big income by exporting the famous Cyprus Potatoes. Property is the other big income provider but for how long?

4. Salaries are very low. No couple under even an average wage can survive! You will need a big mortgage if you want a decent house. Life in general like shopping is also expensive. Yes bills are still cheap and to be fare there is a fare amount that is cheaper than the UK. Finding a job is also a problem. Qualifications would not necessarily help you. It is who you know in Cyprus that gets you the job.

5. Cyprus is a bit of a boring place to live. It is exciting for the first few years but eventually you will get fed up with the sun and the sea. I am not sure if a golf course will help (not many people are into this sport) or a new Marina mentioned in of the replies? This is not a way to attract your average family. Make sure you have enough money to be able to get out of the island (especially if you miss home or your family). Also go on holiday yearly. You kind of forget about this living in Cyprus.

6. Don’t’ trust anyone. A nice Greek-Cypriot person is a profitable nice Greek-Cypriot person. It is very hard to find an honest trustworthy person over there. It is al about money. Greed has taken over (us Greeks are a bit greedy by nature). We have seen even the simple villager asking for ridiculous prices. Take for example Alethriko, a Larnaca Village where a simple plot of land is sold between £65,000 and £100,000. A big property investment company pulled out in 2004 (may be 2005..not sure) because the developing company put its prices up. The end result is that the investor pulled out and the developer lost millions of pounds of sales. Greedy? I think so.

7. No potential for investment. It is not London guys. There is a reason why so many people invest here in London. Cyprus is only for living a family life (or retiring). Do not be fooled by what people say.

8. The Cyprus invasion is still a problem. Not sure what would happen to the whole island if there was a solution. My feeling is that the south will suffer.

9. The euro entry in 2008 will bring a lot of surprises. There is a big reason why the UK has not accepted it. Just look what happened in Greece when it entered. To clarify that in 2008 Cyprus will no longer use the Cyprus pound but the Euro.



I am Greek from Cyprus myself. I have learned to deal with reality and not promises and sweet talk. I am also moving out this year but ready to face these problems. Despite of what I said above, Cyprus is a lovely island and no comparison to the busy and hectic life of London. Try is first before committing. Do not sell your home abroad just in case you change your mind. Renting your property (at least in London) is not a problem. Take your time. Rent something out there (rents start at £250 a month for a 3 bed flat) and see how things go. The next 2 years are crucial. Do not forget that the only reason why prices are so high is due to the marketing campaign that was put out just before Cyprus entered the EU. Every Greek-Cypriot I know from London bought something as not to miss out. Now what? Where are all the new buyers going to come from especially with SO MUCH-cannot do anything about-MARKETING OF NORTH CYPRUS? The Cyprus property market will be in deep problems if nothing is done. I suppose we will soon find out.

[bazza]

Sorry guys...just a small but important correction. I meant rent starta at £250a month for a 3 bed flat and not £250 a week. These are London prices.

Also to clarify that in 2008 Cyprus will no longer use the Cyprus pound but the Euro.