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Cyprus FAQ's -
Q. What is the cost of living in Cyprus?
A. The cost of living in Cyprus is low compared to many other European destinations.
On average, the annual charges for four adults living in a three bedroom house are as follows: Gas -cy£12.00, water - £100.00 and electricity- cy£400.00
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Q. Can I work in Cyprus once I have moved there?
A. Under the Aliens and Immigration Law, non-Cypriots wishing to take up employment in Cyprus are still required to have a work permit. However, this process is a formality which is expected to be lifted over the next couple of years. Permits are granted in normal circumstances, without question.
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Q. How does the medical care system operate?
A. The medical care system in Cyprus is very inexpensive. A doctor's visit costs about cy£10 and X-rays about cy£15. Inexpensive Private Medical Insurance is also available. Cyprus residents, whether Cypriots or not, can have a private medical insurance starting from cy£130 pa. The health care is of a very high standard. The majority of the doctors have being trained in the U.K and U.S.A.
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A. Cyprus enjoys a remarkably low crime rate, at 1/6 of the European average. This is another reason for its popularity with foreign buyers, for whom security has become a key element in the property world. Visitors are invariably surprised and reassured by this relaxed aspect of life on the island, where crime is virtually unheard of and theft not commonplace.
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Q. Is the British Pension subject to Tax payment?
A. Yes it is! According to the Cypriot tax system you are obliged to declare your income from pension. Individual non-Cypriot residents are taxed on a flat basis of 5% per annum on pension and investment income brought into Cyprus. In some circumstances, exemptions totaling up to cy£4,000 per individual or cy£8,000 per married couple apply.
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Q. What about Inheritance Tax?
A. There is none.
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Q. What other tax advantages are there?
A. Compared with other international financial centres, Cyprus offers a distinct benefit in the form of double taxation treaties. Agreements with an increasing number of countries eliminate the double taxation of income earned in any one of these countries. In practice, the tax levied by one country is credited against the tax levied in the taxpayer's country of residence. Where different tax rates apply, the tax payer will ultimately not pay more than the higher of the two rates of the respectively countries. Immigrant retirees may import personal effects, household goods and furniture duty free. This is provided that they are for personal use and have been in use for at least one year. There is no duty on one car and retired couples benefit from the additional concession of two duty free cars.
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Q. What are the driving regulations in Cyprus?
A. Visitors in Cyprus may drive using a valid International Driving Licence or their National Driving Licence, provided it is valid for the class of vehicle they want to drive. If they wish to get a Cyprus driving licence, then they must convert their national licence to a Cypriot one or take the driving test. In any event, the Cyprus licence will cost CY35 pounds for a lifetime.
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Q. Do the properties have title deeds?
A. Properties have title deeds. The title deeds are transferred to the buyer's name as soon as they are issued by the Land Registry Department and following the settlement of the agreed selling price, and the Council of Ministers approved.
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Q. How do I get the Title Deeds to my property?
A. Transfer of ownership from vendor to purchaser is accomplished by a simple procedure through the land registry office. The contract of sale must be in writing, and it is advisable that such contracts be registered at the District Land Registry Office within 60 days from the contract date. When issued, the title deed will be registered in the name of the buyer and will be recorded in the confidential government archives.
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Q. Can I sell the property easily? Will I be able to take the proceeds of sale out of Cyprus??
A. You can sell the property at any time and with no restrictions either through our office or through a registered estate agency. The equivalent of the full purchase price can be remitted immediately. The balance reflecting an increase in its value can be sent overseas at the rate of cy£50,000 per year, plus any interest earned during the year, starting from the year after the sale. Property sales in Cyprus are subject to capital gains tax at a rate of 20% on the profit. The first cy£10,000 profit per person named on the title deed is exempt.
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Q. Are the property prices increasing?
A. Cyprus is a small island with a limited supply of land and properties. With Cyprus' accession to the E.U. demand is expected to grow and as a result property prices are predicted to increase dramatically. Properties that are well built and well maintained benefit from the highest increases.
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Q. Do you provide after-sales services?
A. We and our associates pride ourselves on our after-sales service. Our in-house property management department is always here to help.
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Q. What media is available in Cyprus?
A. There are six Cypriot/Greek T.V. stations available at the moment free of charge. Approximately 30% of the programmes are broadcast in English and all foreign films are broadcast in their original language, with Greek subtitles. Residents can also subscribe to the Cypriot cable service LTV to watch US and UK sports and programmes. There are also a number of satellite services available including Sky. There are also numerous radio stations, which are broadcast in Greek and English. In addition to these is the British Forces Radio that broadcasts on a 24 hour basis in English. The island offers two independent English newspapers and UK national papers are available on the island, usually with a delay of only one day from their date of issue.
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Q. What is the Cypriot communication system like?
A. Cyprus has one of the most advanced (rated third in the world!) and cheapest telecommunication systems available. ISDN, ADSL and standard dial-up PC networking are also easily accessible.
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Q. What is the governmental structure in Cyprus?
A. Cyprus is an independent and sovereign republic with the elected president (5 year election cycle) as head of state. The legislation power lies with the elected House of Representatives and appointed council of ministers. The legal system is based on the British/European system with independent power exercised by judiciary. Cyprus is a member of the EU, UN, the British Commonwealth, the non-aligned movement, World Bank and IMF.
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Q. If I purchase a rental property what sort of income can I expect per month for long-term tenancy agreements?
A. The long-term rental market is very active and properties are let from £250 a month up to £700 a month.
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Q. If I purchase a rental property what sort of income I can expect per day for short-term lets?
A. The minimum daily rental you can expect to receive is £20. As a general rule we market one bedroom properties at £30 and three bedroom properties from £50 a day. For a 3-4 bed villa with private a pool daily rentals range from CYP£90-140.
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Q. What are the benefits of long-term rental over short-term lets?
A. Long-term rental provides owners with a regulated monthly income enabling annual financial planning. In our experience long-term rentals are subject to less wear and tear than short-term lets which are more costly in terms of maintenance, breakages and cleaning. Short-term lets often have long vacant periods, especially during the off-peak season. In both cases you're looking at an average return of 5-7% per annum from rentals combined with a 7-10% capital appreciation per annum. That gives you a total return of 12-17% per annum on your investment.
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Q. What are the advantages of short-term rental over long-term?
A. Short-term rental can be charged at much higher rates. It also has vacant periods during which the owner can us the property as a holiday home.
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Q. Would I need to top up the mortgage if I let a property long-term?
A. This is totally dependent on the amount borrowed and the length of the term. Usually in 25-30 year repaiment plans now toping up is needed.
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Q. How much commission do Quality Property Management charge for managed rental services?
A. We charge 15% of rental income received.
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Q. What are the average management charges for communal services?
Currently communal service charges range from CY£20 - 40 per month depending on the project and the services provided within the project i.e. Swimming pools, tennis and squash court, gym, etc
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Q. What is included in the managed rental services?
A. Included in the price we will: Carry out pre-tenancy clean, find tenants through various marketing and advertising sources, prepare rental contracts, take copies of tenant identification, hold deposits, prepare inventory, carry out check-in with tenant, property and key handover, organise and oversee rental payments, carry out check-out, return deposit, email/post dilapidations report and request for necessary costs.
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Q. Can we as owners of the property also let our properties privately?
A. All owners may use as many different sources to let their property as they wish. We do not ask for sole exclusive rights to rent out our clients' properties. We are offering the service primarily to assist rather than to make a profit. All that we ask is that you keep us informed of availability.
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Q. How much can I expect to spend fitting my property with appliances and furnishings?
A. You can expect to spend between £3,000 and £5,000 on a one or two bedroom property, dependent on the size of the property the quality of the items purchased.
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Q. Can the Quality Group of Companies help with the purchase of goods?
A. We will get involved as much or as little as you wish. We can simply recommend stores and items, go shopping with you or purchase all of the goods on your behalf and save you travelling to Cyprus.
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Q. How much can I expect to spend on utilities and council rates in Cyprus?
A. Normally local council rates for services such as rubbish collection etc are no more than £80 a year per property. Bottled gas is charged at around £3 a bottle and lasts around three months. Telephone call charges in Cyprus are set at one of the cheapest rates in the world. Electricity on average s about £400 a year and water around £100 a year for a three bedroom property.
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Q. Are other living costs in Cyprus cheaper than the UK?
A. Petrol in Cyprus is charged at around 48cents a litre, an evening meal in a restaurant including drinks ranges from £10 per head. Motor and health insurance is considerably lower than in the UK.
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Q. Roughly how much are property insurance costs?
A. As a general rule property insurance is charged at 1.65% of the current property value and contents are calculated at 2% of their total value.
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Q. How would I organise an insurance claim in Cyprus ?
A. You will find that all the institutions we recommend are English speaking and the procedure for claiming is the same as that in the UK.
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Q. Can Quality Group of Companies assist with insurance and mortgages?
A. We can help with the arrangement of insurance and various loan facilities. Alternatively all clients are free to go to their own preferred financial institutions.
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Q. Do you have a simple formula for the calculation of mortgages?
A. Please look at our mortgage calculator available on our website.
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Q. Is it better to purchase properties as an individual or to set up a Cypriot company?
A. There are several factors to consider although as a general rule we recommend that anyone buying more than 3 units registers a company. Please see the attached "Trading in Cyprus" section on our website for more details.
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Q. What are the standard payment terms when purchasing a property from the Quality Group of Companies?
A. To reserve a property from our company we request a non-refundable deposit of CY£2,000. Generally within 20 days we ask for 30% to be paid at which time we shall register the signed contracts of sale with the land registry. We shall then request 20% upon the completion of the structure, 15% upon the completion of brickwork and rendering, 15% upon the completion of flooring and 20% upon delivery.
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Q. How long after delivery can I expect to receive my title deeds?
A. Title deeds generally take a minimum of 6 months and a maximum of 36 months to be delivered to the owner.
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Q. What happens if the company goes bankrupt before the property is completed?
A. The 30% deposit approximately represents the value of the land. More payments are made upon completion of each stage of development. In the unlikely event of our company dissolving the land registry would sell the land and the unfinished development and pass the proceeds on to clients who have registered their properties.
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Q. What yield can I expect if buying a property for investment?
A. If you purchase a property off plan you can expect an increase of 15- 20% by completion over an 18-24 month period.
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Q. Do you have any case studies supporting these figures?
A. We can discuss the success and appreciation of many of our previous properties. For example on its release in spring 2004 one-bedroom properties in Hills 4 were sold at £28,000 and two bedrooms at £42,000. Recently the same properties have been resold at £51,000 (including furnishings) and £70,000 (including furnishings).
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Q. Are the properties for sale freehold or leasehold?
A. All of the properties we sell are freehold.
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Q. How does buying in Cyprus compare to buying in other European countries?
A. Buying in Cyprus is very simple. The legal system is based on the British legal system making contracts and processes easy to understand.
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Q. Is there any form of compensation for late delivery of property?
A. The Quality Group of Companies will compensate clients if we are responsible for its late delivery. Our sales contract contains a clause relating to this matter.
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Q. Is there any incentive or discount offered by the Quality Group of Companies to encourage me to buy a second or third property?
A. Each case is viewed individually.
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Q. When do I receive title deeds for my freehold properties?
A. In Cyprus title deeds, unlike the UK , are issued after the completion of the project. In the case of houses this process may take up to 18 months. For an apartment in a project of 10 to 60 apartments this process can take up to 3 years. This does not mean you can not sell your property at any time before that. From the minute your contract of sale is registered at the land registry department the property is officially yours and you can sell your property the next minute.
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