This action might not be possible to undo. Are you sure you want to continue?
But today I am promoting my new eBook on Real Estate Marketing in the 21st Century. I wrote this book, because I am in the real estate business myself. In fact, everyday, I help people who are losing their home to the foreclosure. This is my book on how to get your real estate business to market the most effective way. In the book are the exact strategies I used to help 100's of families a month. Thanks and I hope you enjoy the book. You can find it as the link below. www.amazon.com/dp/B006ZCC50A ==== ====
On the 12/1/08 Saturday Mr Antonis Loizou has given a lecture at Ayia Napa on behalf of the U.K. Alzheimer's Society, which was attended by 120 mainly foreign residents in Cyprus. The subject was the Real Estate Market in Cyprus. We provide a shortened version of the speak. Real Estate Investment, be it a house, land income producing property or development, has been so far a "safe" investment in terms of security of capital. Since 1974 prices have been moving upwards at varying rates p.a. Upto the year 2001, prices moved upwards on average 7% - 10% p.a., but since the Cyprus Stock exchange crash, investors interest turned towards real estate. Cyprus' inclusion to the E.Union, coupled with the most favourable tax system in the E.U. and the Russia-Cyprus double taxation treaty, has caused Cyprus to attract an increasing influx of European and Russian interest, which has helped real estate investment in Cyprus. The lifting of restrictions regarding property purchases by E.U. companies and citizens, has widened the scope of real estate investment and now, it is estimated that foreign buyers in Cyprus real estate contribute around CP700 mil. This is just short of the biggest foreign exchange earner, the Tourist Industry and its CP1.200 bill. p.a. and far ahead from the third biggest foreign currency earner i.e. the offshore companies contribution of around CP350 mil. p.a. This keen foreign demand, coupled with the local interest as well as the added taxation on real estate, such as V.A.T. of 15%, has caused prices to move at a rate between the years 2002 2004 of around 15%p.a., whereas the very recent years prices have shot up by almost 20% p.a. This is particularly so regarding building plots and land and more recently towards agricultural land. With prices of development land being so expensive and with the planning laws allowing the development of a single house just about everywhere, the public's interest has been diverted with an increasing volume towards agricultural land, where prices have shown increases in excess of 30% - 50% over the last year alone. This situation of high development land cost, converts now to around 40% of the total development cost of any house/apartment, whereas a couple of years ago, the land cost on a building sales price amounted to 20% - 22% only. This unhealthy state of affairs will get worse with the introduction of VAT on building land from 1st August, 2008. So, when it will end and more importantly are we heading for a real estate crash? I doubt it. Since
so far these substantial increases in property prices, have been absorbed by the public, be it, it has affected the rate of sale mainly for the less competitive projects making in part, the market, rather unpredictable and somewhat uncertain. To this negative picture one must bear also in mind that various positive/balancing measures that are now in hand. The reducing interest rates [as for 1.1.08 from 4.5% this rate it is reduced to 4.0%] and the longer repayment periods of loans that are now offered have helped. The new Central Bank measures regarding own contribution in buying or developing real estate which has increased the original contribution of 20% to 40% [for non own users - permanent residents] is expected to affect the "by to let" market, since returns/fields in Cyprus are very low [around 4% p.a.] and it is one of the lowest in the popular holiday home destinations in Europe, whereas high cost of air tickets etc. makes letting not as easy as in other countries [some balance may be gained when low cost air fair airlines are in full operation in Cyprus]. The pending new infrastructure measures such as the pending development of the two airports in the Island, the pending development of the 4 new marinas [expected to come around the year 2012] now under offer, as well as the expected 7-8 new golf courses, will add to the island's attraction, making Cyprus, perhaps, the most densely area in Europe in terms of golf courses per population. On the other hand if these projects materialise [i.e. golf/marina/Larnaca port projects] they will place in the housing market [mainly directed towards the foreign people] around 10.000 new housing units in addition to the normal number which are now produced [approx. 5.000 p.a.] With the existing demand of around this number [5.000 units] and even considering an increase in demand due to the above infrastructure properties, the supply will surpass demand in the year 2010 -2015 with possible negative affects on the holiday home market prices. Buying / building real estate/homes in Cyprus is easy, since it is the most popular business. At this point of time "Property Development" is carried out by just about everybody independently of qualifications, financial status, honesty etc. For this reason we note an increasing percentage of delays uncompleted projects, projects without a permit etc. and as such, care is needed. For this reason I have prepared for your consideration our firms "10 Building commandments" which every potential real estate buyer should follow as much as possible. Buying in Cyprus is easy, but selling your property is another matter however. One must compete with the aggressive and well connected developers, well organised estate agents [some of which charge in excess of the legal 3% -5% - rates reaching upto 15%] so you must take into account not to be in a particular hurry should you want to sell your property. As I have said before, real estate prices have recently moved upwards at a rate of 20%. This is partly due to the foreign interest which represents approx. 20% of the total real estate acquisition in Cyprus. This is a very high percentage especially where it is concentrated in certain areas. So care is needed since if you chose to invest in such popular areas of foreign people concentration, you stand a higher risk of price adjustments up and down, since foreign people behave differently than the locals whose demand/supply is inelastic. The following table is quite an interesting one illustrating foreign peoples concentration [on a % of the total demand of the area]
Nicosia Famagusta 5% 50%
What are we going to do with the Russians my dear friends? As this country becomes more stable and as oil prices move upwards so the middle/upper middle income, Russian people will become more and more financially able and to turn their attention to the holiday home destinations. The average sale prices per sq.mt. for this type of property that the Europeans usually buy is in the region of CP1.500 - CP2.500 [max.] per sq.mts., the Russian market with a particular interest for Limassol, has even shown prices of CP4.000 - CP6.000/sq.mt. for beach units. With a mathematical calculation Cyprus beach and even the near the beach locations will be acquired by the foreign market and this is something which one must consider. Foreign buyers demand affects the local population whose income is not competitive to the foreign market and who is gradually outpriced. This will create several problems, whole areas/towns will be inhabited by foreign residents, at periodic visits [see Sotira area west of Ayia Napa] and even the complete take-over of small villages and I dare say towns [see Pafos in 10 years' time]. Ofcouse I am not against the foreign market and I know that Cyprus cannot go back to the restrictive system on foreigners real estate sale, so it is more of a theoretical approach than otherwise. We live in a global economy and now with the E.U. travelling and settlement abroad will become easier and easier. Cyprus is at a fortunate position regarding the weather, be it with little drinking water, but in closing, I will say that yes, invest in real estate, but take care and do not outstretch yourselves financially. Do not depend on rental income to repay the loan, bearing in mind that you need around 10% of the 12 month income of a residence to cover repairs/void periods and management, in addition to any tax implications, including your tax liability in the event of a resale. For those who are permanent residents however, my advice is try to learn some Greek words or even better, to speak the local language. I know that trying to learn Greek is most difficult [two types of languages, the written proper Greek and the local Cypriot speaking Greek - quite difficult]. If you manage to master part of the language, it will make your life much easier, although I am aware that even when you attempt to practice your Greek language skills, people will quickly reply to you in English. If you manage to speak the language I can assure you it will make your life much easier/happier here.
http://www.aloizou.com.cy email@example.com Mr Antonis Loizou FRICS, is the Managing Partner of Antonis Loizou & Associates, a professional
service provider based in Cyprus. Mr Loizou has practiced in the UK and Cyprus for over 30 years, has a long track record of providing advice on complex real estate projects, writes regularly in the financial press, and is involved in the highest levels of the Cyprus government influencing policy.
Article Source: http://EzineArticles.com/?expert=Antonis_Loizou
==== ==== Hi friends. Usually I am promoting someone else’s products. But today I am promoting my new eBook on Real Estate Marketing in the 21st Century. I wrote this book, because I am in the real estate business myself. In fact, everyday, I help people who are losing their home to the foreclosure. This is my book on how to get your real estate business to market the most effective way. In the book are the exact strategies I used to help 100's of families a month. Thanks and I hope you enjoy the book. You can find it as the link below. www.amazon.com/dp/B006ZCC50A ==== ====
This action might not be possible to undo. Are you sure you want to continue?
We've moved you to where you read on your other device.
Get the full title to continue listening from where you left off, or restart the preview.