According to the law of TRNC (Turkish Republic of Northern Cyprus) non-TRNC citizens are entitled to purchase only 1 property unit and a land plot maximum of 1 donum (1 donum equals 1/3 of acre, or 1388 sq m, and consists of 4 evleks) per 1 owner. Also according to this law, spouses are regarded as 1 owner (relatives with the same surname are also considered as 1 owner). If you wish to take Title to more than one property unit, or a land plot over 1 donum, there are some ways out: you can use trustees or set up a TRNC company to hold the title to the property for you. We can give you professional advice on it.
The greater number of people discovers the beauty of Northern Cyprus (TRNC) and realizes the wonderful opportunity of investments into the local property (for permanent residence, lease, as well as to own a holiday home or just as profitable investment), the faster the number of developers and constructors seems to grow proportionally. For the potential property buyer such a vast choice of both developers and property units could turn a rewarding and enjoyable experience of selecting a ‘dream house’ into quite a tiring and severe test. Although Northern Cyprus is a relatively small country, the attempt to examine every single property unit for sale on the island would prove exhausting even for the best-prepared. Here are our top tips to help you to find your dream property in Northern Cyprus.
1 – Examination of the Subject Before you visit Northern Cyprus, do as much research as you can on the internet. Decide on your budget, the size of property that you need and the type of property, i.e. a detached villa in the countryside or a modern apartment in the centre of a busy town, a house in the mountains or at the seaside, ready or off-plan property, for rental purpose, for permanent residence or just for spending holidays several weeks per year… To answer all these questions, please read our section “How to Choose”.2 – Location, Location and once again Location – - here you are three most important questions that you have to answer while choosing property. Kyrenia is the axis of Northern Cyprus and you are likely to go to Kyrenia for shopping, dining out and other forms of entertainment more often, than to the capital town of Nicosia (Lefkosa). Therefore if you’re the type of a person who wants the maximum choice of entertainment and facilities, you’ll need to keep this in mind when looking at property locations.
If you’re happy with the quiet life you’ll find out that property often gets a little less costly when you move further away from Kyrenia. Since the territory of Cyprus is small and even the farthest region is not more than a 30-minutes’ drive from Kyrenia. If your aim is just a profitable investment, then Esentepe, Bahceli and Tatlisu are the hot spot areas for properties nowadays. To help you answer the “location” question we made a detailed location guide for you in our section “Places Description”.
4 – Trim Your List
Now we will try to trim the list and we will try to reduce it to no more than 10 variants for each type of property that you have chosen. Anyway, during the process of examining the property here, in Northern Cyprus, some new ideas or requirements can come to your mind, and we will be able to decide with you on the spot, what else can make sense to see.
5 – Get-to-know Trip to Northern Cyprus
This is probably the most important tip. From our experience we can advice you not to visit the island and exhaust yourself trying to see as many properties as possible – you’ll end up tired out and very confused. Buying any property is not a trifle and deserves some time and thought. If you can spend 2 or 3 weeks for your trip, it will be great! Even if you can afford to spend only 1 week in Northern Cyprus, we will try to do our best to plan your trip as effective and convenient for you as we can. And certainly we’ll not forget about leisure and rest to make sure that you will enjoy the trip. Detailed information about a Get-to-know Trip you can find here.
6 – A Final Tip
If it starts to get confusing, we advice you to cancel any further appointments for at least 1 day (if the duration of your trip allows to) and spend it by the swimming pool or at the seaside relaxing until your “batteries are recharged”. It will give you a chance to collect your thoughts and to realise what you actually need. Anyway, if you don’t find your dream house during your first visit, then you’ve got the perfect excuse for another holiday in beautiful Northern Cyprus.
OK, let’s assume that finally you’ve chosen the house of your dream in Northern Cyprus. Congratulations! The most difficult things are behind, the rest is our business. And again an important tip – before buying property, you should always get legal advice. It is highly recommended that the Sale Contract is drawn by an independent solicitor. The first step will be an initial meeting with the solicitor (we can recommend you some of them, since the country is small and we know the reputation and proven track record of all of them; though you are free to choose someone else). The aim of the initial meeting is to give him all the information about the property you have chosen and any preliminary agreements you have made with the seller regarding the price, payment plan and other particulars. This stage may also involve taking a power of attorney from you to ensure that the solicitor can act on your behalf to sign the documents if you are away from Northern Cyprus for long periods of time.
The solicitor will act in your interests to make sure that
-the seller is the registered freehold owner of the land
-there are no mortgages / charges, injunctions or other encumbrances on the property
all necessary permissions for building your property and licenses are in proper order
the terms and conditions stipulated by the seller are fair and reasonable.
Your initial holding deposit to secure your property (usually GBP 1,000) will be paid at this stage to reserve your property unit and freeze its price. This is essential due to the fact that prices on properties in Northern Cyprus are constantly increasing. Please note that the reservation deposit is non-refundable. The solicitor’s fee for all his services regarding your purchase, starting from the legal opinion, the Sale Contract and up to the final receiving of Title Deed, is also around GBP 1,000 and is usually paid at this stage.
The solicitor will then prepare a Sale Contract to safeguard your interests. The Sale Contract will include all important terms and characteristics such as a land plot, its cadastral number, plot size and location, price, payment plan, completion date with penalty clauses for late completion and all floor plans and specifications, which will be attached to the Contract to ensure that the seller is bound to carry out the construction work in accordance with it. The Contract will be sent to both the seller and the purchaser for consideration. When both parties are satisfied, the Contract will be signed. At this satge the first payment, due to your Contract, must be made. Please, see our section “Payment Plans” to know the plans, which are in common use in Northern Cyprus property market.
At this stage you will be given the opportunity to pay the Stamp Duty. Under the new regulations, the Tax Office requests to see a copy of the Sale Contract with the paid Stamp Duty prior to transferring the Title. This procedure will make it impossible for the unfair seller to sell your property once again (before you receive the Title Deed). This new regulation is a safe government guarantee for the purchaser. The Stamp Duty equals 0.5% of the assessed value of the object if paid within 1 month upon the signature of the Sale Contract. If it is not paid within this time, it increases up to 1.5% if paid after 6 months upon the signature date. You will have the choice to pay right away or pay on transfer of the Title but at a higher rate.
The solicitor will then make the application to the Council of Ministers for your Purchase Permit. Whilst processing your purchase permit application, the Council of Ministers will make inquiries from the land registry, the military and the immigration authorities and provided that these are positive, the permission will be granted. The permission process can take a long time to complete, the current estimation is from 1 to 2 years. However this will not prevent you from moving into the property or leasing the property or possibly even selling the property. As standard practice, we always try to negotiate with the seller the insertion of a clause into the Contract allowing you to sell the property before taking the Title to the property.
The Purchase Permit will certainly be issued if you buy the property which is legally allowed to be sold to you (this is checked by the solicitor), if you’re not wanted for crimes including those against Turkey or Northern Cyprus (you will have to present a document from your local office of Internal Affairs) and if your property is not situated near the local military objects (this is also checked by your solicitor). In the unlikely event that your application for the permission is refused, you will be able to nominate any other person to take the Title on the property on your behalf and hold the property on trust for you. We can also provide advice on other ways to secure your interests until you receive the Title Deed, for example by registering a trusteeship over the property. Also we can assist you with the drafting of the necessary trust deeds. If you wish, we can also try to negotiate with the seller to insert a clause into the Contract stating that in the case that the Purchase Permit is refused, the seller will refund the purchase price to you.
Once your Purchase Permit has been granted, the solicitor will notify you and then fill out all the necessary land registry valuation forms for the valuation of the property. It is usually at this stage that the taxes should be paid. The taxes are calculated according to the land registry valuation and are currently at the following rates:
1 – Land Registry Transfer Fee at 6% (however, every purchaser has a right once a privilege to reduce this fee from 6% to 3%). At the moment of the Title transfer, we will ask you whether you wish to use your privilege right away and if you do, you will only pay 3%.
2 – VAT at 5%
3 – Stamp Duty at 1.5% (if not already paid at 0.5%, as explained above)
After the taxes have been paid, the Title Deed will be registered in your name. If you have left the solicitor with a power of attorney, all of this can be dealt with without you being required to travel to the TRNC. The solicitor will then collect and keep the Title Deed for you until you are ready to collect them.
If you buy from a non-Cypriot seller, the buying process in Northern Cyprus usually becomes easier and happens in the following way.
As the main checks referring to the property have already been carried out by the Council of Ministers to allow the property to pass into ‘foreign’ ownership, the entire buying process will not only be far simpler, but you’ll find out that it is performed far more swiftly too.
You find your dream property and agree on the price with the seller.
The appointed solicitor makes all necessary inquiries and prepares the Sale Contract as described above. The seller and purchaser sign the Contract. The purchaser pays the full sale amount (unless you agree with the seller about the payment by installments or payment plan). The taxes, duties and fees listed above are payable at this stage.
On the completion of payments due to the Contract, the Title Deed is transferred into the purchaser’s name. The sale is completed.
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