Assetz® News - Smart spending in South Cyprus

Smart spending in South Cyprus

27th April 2005 |

Northern Cyprus has proven and continues to be a popular choice for Brits looking to live abroad, with some 6,000 people currently living in the region and people continuing to invest in properties in the area all the time, attracted by the promise of cheap property. With cheap flights, good weather and an infrastructure that Brits will find familiar it is no wonder that Cyprus is the preferred second home of so many, not to mention low income tax and no wealth, inheritance or gift tax to speak of.

Despite these trends concerns are mounting that Northern Cyprus might not be the idyllic land of bargains many believe it to be, with a rising number of buyers looking further south for that perfect second home.

The fact is that though prices have seen something of a boom in recent years property in Northern Cyprus is relatively cheap, but the flip side is that investment in the region comes attached with a significant risk. According to Property agents Halycon the price of properties in Northern Cyprus might not always include the land upon which the property stands. As a result, an unlucky buyer could find themselves paying a compensation claim or losing the property altogether. "The property is cheap in the north of Cyprus," Halycon director Pauline Gallagher told the Independent. "It's that simple. But you really have to ask yourself why it's so cheap."

Conversely, Southern Cyprus offers a more stable property market, evidenced by the rising number of agents choosing to sell property there. Agents remain confident that prices in the region will see a sustained annual growth rate of between eight and ten per cent and highlight a strong rental market.

Furthermore Cyprus' accession to the EU last year saw an influx of families and young professionals from all over the continent. The south has proven especially popular due the variety of properties on offer at different price ranges. Key destinations such as Paphos and Peiya remain popular among holidaymakers and housebuyers alike, where two-bedroom apartments with communal swimming pools can be found for sub-£100,000.

On the slightly cheaper end of the spectrum, Larnaca and Limassol offer more for less, where roughly the same amount of money could buy you a smallish villa with pool. Larnaca also features a strong business environment, and the international airport offers a convenient travel link for short and long-haul business travel. For these reasons it would be fair to expect a downwards shift in demand for Cypriot properties, raising the profile of the Republic of Cyprus as a good target for property investment among widening base of professionals seeking homes abroad.