CYPRUS is having a makeover. The eastern Mediterranean island, best known as a
cheap package holiday destination with a slightly dodgy Garage music scene,
is setting itself up to attract an altogether different type of tourist: the
big spender.
As the country prepares to swap the Cyprus pound for the euro in January,
plans are afoot to build new golf courses, a massive marina complete with
underwater restaurant, two new airports and a series of new roads. Property
prices have been rising steadily in the run-up to the euro, which is
expected to give the island’s already healthy economy a further boost by
making Cyprus even more attractive to investors.
This former Crown colony has been attracting the British for decades; 80 per
cent of the population speaks perfect English. Buyers come for the annual
average of 340 days of sunshine, the low crime rate, high standard of living
and low prices. Pensioners enjoy a favourable tax regime and good
healthcare. The standard of education is reasonable and the number of
English-speaking international schools is increasing.
But if the tourist boom of the 1980s led to the emergence of hordes of tiny
concrete apartments and monolithic hotels blocking sea views in town
centres, the current reinvention of Cyprus is inspiring the building of
detached villas with swimming pools and a price tag of CY£500,000 (£596,500)
or more. You will find them high on a hill in the property hotspots of the
Paphos region on the western coast of Cyprus, where most of the big
infrastructure changes are taking place. Around Coral Bay, where five
consortiums are bidding to build a marina with 1,000 berths and space for
two cruise ships, prices have risen by between 30 and 40 per cent over the
past couple of years, according to BuySell, the island’s biggest estate
agent. Given the more modest price appreciation in the rest of Cyprus of
between 7 and 9 per cent a year, that is quite a leap. It is said that
investors have been particularly keen to buy land on the clifftop
overlooking the site of the future marina. But one of the attractions of the
hilly Paphos area is that you do not need to be on the seafront to have
decent sea views.
Investors are presumably encouraged by talk that the Cypriot Government is
aiming to make the island a serious golfer’s destination by granting
permission for 11 courses (see story right). Away from the hotspots, prices
are still reasonable and, for all the recent speculation, the property
market appears solid, straightforward and certainly far less volatile than
some of the emerging markets, such as Marrakesh. BuySell is offering a
four-bedroom villa in the hillside village of Neo Chorio overlooking Lakki
for CY£455,000. But similarly breathtaking views come cheaper if you are
prepared to drive farther inland to Peristerona, where a two-bedroom
townhouse with a shared pool costs CY£95,000. Nearer Paphos town, a
three-bedroom villa in Kissonerga costs CY£145,000 and a similar property in
Anarita costs CY£159,900. If all you want is a bolt-hole, a studio in Kato
Paphos is CY£36,995.
Frank and Christel Walker did a tour of Europe before choosing Cyprus as the
best place to spend their retirement. Frank knew the island from his days in
The Parachute Regiment, and the couple visited Cyprus three times to
house-hunt. They ended up buying a three-bedroom villa with swimming pool
near Pegeia and just south of the Akamas nature reserve on the west of
Cyprus. “We liked the laidback attitude here. The Cypriots are very friendly
to the Brits, the legal system is similar to ours, and everything is
translated into English,” says Mrs Walker, who made a permanent move from
Aberdeenshire earlier this year. The villa, which has sea and mountain
views, cost CY£250,000 off-plan 18 months ago, but has since been valued at
between CY£350,000 and CY£400,000.
Sellers have been encouraged by the recent price increases in Cyprus and many
are confident of achieving good prices. But the higher up the market you go,
the longer properties tend to linger in the estate agents’ windows. The
resales market is limited.
Cypriots tend to build one house and live in it for life. Britons wishing to
move out must rely on buyers from overseas. According to BuySell, about 75
per cent of sales on the island are made to UK buyers. The vast majority
settle here for good, having sold up in Britain. Choose carefully and you
might be able to swap your Victorian terrace house in the UK for a villa
with a pool in Cyprus and still have enough money to live on. But you have
to be quick.
FACT FILE
Cyprus joined the EU in 2004. Turkey has occupied northern Cyprus since 1974.
Taxes are low: the equivalent of council tax costs £70 to £100 a year. Income
from a pension is taxed at 5 per cent.
Property buyers must pay a transfer fee of between 3 and 8 per cent of the
purchase price when registering the property. If buying off-plan, you can
defer this until the property is complete.
Stamp duty is 0.15 per cent on the first CY£100,000 of the property’s price
and 0.2 per cent for sums above that. A couple can live comfortably on
less than CY£500 (£600) a month.
Contacts: www.buysellcyprus.com www.aphroditehills.com
www.aristodevelopers.com www.whereonearth.biz
, www.cyprusgolf.com www.buysellcyprus.com
www.paradorproperties.com
TEE OFF BESIDE YOUR OWN VILLA
THE island is already known for its warm climate and low prices, which are
between 20 and 30 per cent below those in Spain and Portugal, according to
some estimates. Now Cyprus is adding to its appeal by building 11 golf
resorts. If that wasn’t enough to appeal to second-home buyers, property
values are predicted to rise sharply once Cyprus adopts the euro in 2008.
Low taxation and a British-based legal, banking and conveyancing system are
currently enjoyed by 66,000 British expatriates and second-home owners.
In April 2004, Heather and Andrew Sanders, from Camberley, Surrey, headed for
Cyprus in search of a golfing holiday home. They bought an off-plan
three-bedroom villa at Secret Valley for CY£280,000 (£334,000) via Parador
Properties. “The corner plot of three villas really shone out,” Heather
says. “They were the first to be finished, with the added benefit of a
central green area, preserving the views and feeling of space and
tranquillity.” Off-plan plot and villa packages at Secret Valley start at
CY£200,000, while specification villas cost from CY£90,000 to CY£150,000,
with villas from CY£220,000, and there are plans for maisonettes and flats.
On a smaller scale, Tsada Golf Club, next to the traditional village of Tsada,
ten minutes from Paphos, offers 100 plots ranging from 1,000 to 2,000 sq m
and costing CY£39,000 to CY£83,100, dependent on specifications supplied by
the purchaser – as long as the new properties blend with existing ones. By
contrast, Aphrodite Hills (a few minutes east of Secret Valley towards
Larnaca) covers 578 acres and offers 650 villas and apartments set around a
village square of shops, bars and restaurants. Properties range from
one-bedroom flats at CY£170,600 to five-bedroom villas at CY£821,900.
Of more current interest is the Tersefanou golf development backed by the
European Golf Federation, with an expected completion date of September
2008. Located a few kilometres from Larnaca, it will have restaurants and
bars, a business centre, equestrian facilities, a retail village complex and
spa serving more than 1,000 apartments and a number of villas. Apartments on
the golf course will cost from CY£2,000 a square metre, so it’s worth
considering the Suncoast Gardens development in the picturesque coastal
village of Pervolia, ten minutes from Larnaca airport and the new golf
resort. Its 21 one and two-bedroom flats will start from CY£74,000 – up to
40 per cent lower than resort properties. Litsa Chrysostomou, the marketing
manager at BuySell Real Estate, points to infrastructure improvements, such
as the redevelopment of Larnaca and Paphos airports, as “further good news
for golf lovers seeking a stable market for high rental potential and good
capital returns”. PATRICIA WILLIS
For tips on where, how and what to buy, plus the top 50 overseas websites, go
to: timesonline.co.uk/overseasproperty
