FAQ about buying property in Cyprus

The country's economy grew by 8.4% compared to the previous year, according to data from the Statistical Service of Cyprus. The growth of the Cypriot economy is helping property sales in the country, which are up 40% in the first four months of 2022.

According to experts, in the next two years in cities where important infrastructure is being built, real estate prices will increase by 10%.

We are talking about Larnaca - where a large-scale renovation of the Marina is underway, and Limassol - where the largest casino in Europe is being built.

It is important to note that for the first time in two years (since the beginning of the pandemic), the Central Bank of Cyprus noted an increase in average property prices. Sales of residential real estate also grew: in the first quarter of 2022, 24% more sales contracts were registered.

As of November 2022, the average price per square meter of an apartment is 3,238 euros. 

Villas or houses - 2,983 euros (data from the analytical system arcadia.com).

When purchasing real estate in the primary market, the buyer pays VAT, in the secondary market - the title fee. And in any case, he pays stamp duty.

Stamp Duty

This is a tax on the registration of the transaction and the preparation of documents on the transfer of ownership.

It's rate is:

• 0.15% of the first €170,860 of the value of the property,
• 0.2% - on the amount exceeding €170,860.

The stamp duty is paid within 30 days after the signing of the contract of sale.

Title fee (property transfer fee). It is a tax on the transfer of ownership from one owner to another. When buying a new object from the developer, its rate is 0%. In other cases, it will depend on the amount of the transaction. The amount paid is divided into several ranges, each of which has its own percentage.

Fee rate

• €0–85k - 3%
• €85–170 thousand - 5%
• From €170 thousand - 8%

The amount of tax is calculated not on the object, but on the buyer. Therefore, if, for example, you register property for both spouses, the amount for each will be lower, which means that it will fall into the range of lower rates. This is a good way to save money.

• Value Added Tax (VAT). New property in Cyprus is subject to value added tax. His rate is 19%. For secondary real estate, the tax rate is 0%, land plots are not subject to VAT.

Those who buy a new main residence for themselves can receive a VAT exemption and pay as little as 5%. This procedure applies to both Cypriots and foreigners. The exemption was established by amendments to the Value Added Law (VAT law) dated June 8, 2012.

• The applicant is an individual, not a legal entity.
• The property will be his primary residence in Cyprus. It can be an apartment, a house or a residential facility under construction.
• The applicant has no other property in Cyprus acquired within ten years at a preferential VAT rate. After ten years, he can again receive a tax exemption by indicating the new object as the main place of residence.

• The property is used exclusively as a residential property and the applicant is the first person to take actual ownership of the property since the completion of construction.
• The area of ​​the object does not exceed 190 sq. m. Otherwise, the deduction will apply only to the first 190 squares.

The investment program of Cyprus makes it possible to obtain permanent residence for investments in real estate from 300 thousand euros. In just two months, an investor can apply for permanent residence in Cyprus. Conditions: it is necessary to purchase primary housing from a developer worth at least 300 thousand euros.

At the same time, it is not necessary to permanently reside in Cyprus in order to maintain the status of permanent residence - it is enough to come twice a year. Permanent residence is indefinite, extends to the investor's family members and allows you to obtain Cypriot citizenship in five years, subject to all necessary conditions.

• Cyprus resident status in just two months.
• No government contributions, you only need to invest in real estate.
• The status of permanent residence is obtained by relatives of the investor, including spouse, children under 25, parents of the investor and parents of the spouse.
• It is not necessary to permanently reside in Cyprus - it is enough to visit Cyprus twice a year.

• Soft tax regime. No income taxes in other countries, no income tax, income tax and inheritance tax.
• The opportunity to come to Cyprus, even if the borders are closed. At the same time, life in Cyprus is a right, not an obligation of an investor.
• After five years, the opportunity opens up to apply for European citizenship.

Have you decided to buy property in Cyprus for permanent residence and renting out in order to receive a stable high income? Mercury Group Ltd specialists provide a personal approach to each transaction.

We provide our investors with a comprehensive concierge service for all matters related to real estate acquisition in Cyprus.