Investment Property In Cyprus Ltd can negotiate “wholesale” prices with medium sized quality developers for properties in areas that are much in demand. These prices are usually around 15% below market prices.

How it works for the investor is that they would reserve one or a number of these properties with the intention of never taking delivery. In other words, the property is sold on again before completion at the increased market price therefore making the investor a profit.

The other excellent thing about this investment opportunity is, that due to payment terms agreed with Investment Property In Cyprus Ltd the investor only has to invest 20/30% of the selling price of the property as their initial investment, then the property is put back on the market before the next 60/70% is due and sold at the “retail” price so giving the investor his initial deposit back as well as the difference between the retail and wholesale selling prices. (Note: sales commission and contract cancellation fee are deductible when re-selling the property)

Projects Payment Terms:

CY£1000 Reservation Fee (this takes the property off the market)

20/30% of Selling Price Initial Deposit (payable within 30 days of reservation)

60/70% of Selling Price 12 months or after 75% build complete

10% or balance of Selling Price On delivery of property

For our investor clients we place their property back on the market after nine months or two to three months before 75% build complete. Once sold they receive back their initial deposit plus the profit made less deductions for sales commissions etc. (Usually 5% of sales price) The net result is that the client will realise anywhere between 30-50% return on their investment in a relatively short time frame.

Should the client not want to sell the property but go on to take delivery of it then we can arrange a 75% / 80% mortgage for them, this is usually with a leading Cypriot Bank and their rates are currently 2.5% above LIBOR for terms of 10 -25 years.

Example:
Apartment Selling Price 50,000
Client reserves 1,000
Initial Deposit 30% of SP 14,000
Legal Fees 500
Stamp Duty 75 (So total initial Investment is 15,575CYP)

Property put on market after 9-12 months

Property re-sold at new market price 65,000
Profit 50,000 to 65,000 = 15,000
Less sales comm. of 5% (3,250)
Cancellation/admin Fees ( 500)
Net Profit 11,250 (0r 72.2% Return on Investment) These figures change on a 20% initial deposit

Please also refer to the explanatory notes on the next page

For those investors who are new to the concept of buying “off plan”, and buying in Cyprus, the following may be of help:

PROJECTS
These are usually apartment blocks consisting of studios, and one or two bed-roomed units, usually with a communal pool. They are built in locations that will eventually appeal to the buy to let market or indeed to tour operators for block bookings.

HOW CAN YOU SELL AT SUCH LOW COST?
The initial selling price has been negotiated with the developer to be around 20% below market price, this is achieved by close co-operation with the developer in both the design, technical specification and pricing of the project and as the selected developer does not have the high overheads of a large developer, their profit margin is significantly lower. We also offer to the developer the advantage of selling the entire project in a short time frame, so this helps with their cash-flow in funding the build of the project.

WHAT TYPE OF INVESTOR DOES THIS APPEAL TO?
The initial investor is looking for a short-term / high-return on their investment. They are not looking to take delivery of the property and expect to exit within a time scale of 18-24 months. The second investor, who buys at the 75% build stage, is looking for a long-term investment yielding good returns, typically 8-10% per annum on a buy to let basis.

HOW MANY CAN I RESERVE?
You can reserve from as little as one unit up to a whole block, there is no limit. It must be stated that if an investor reserves just one unit and does not re-sell through Investment Property In Cyprus then a 5% surcharge may apply. For those reserving 3 or more, who wish to keep just one unit, no surcharge is applicable.

WHAT ARE THE PROCEDURES AND COSTS INVOLVED?
Once the investor has selected the apartments they wish to purchase then the procedure is quite straightforward. A reservation deposit of 1,000CYP against each unit is necessary to take the apartment off the market and reserve it in the name of the investor. We will require client details and passport numbers at this point. Please note this deposit is fully refundable if the client does not wish to proceed within 20 days of reserving.

After the client has signed the Power of Attorney, the solicitor will draw up the contract of sale. Once this is approved by the client and signed on their behalf, arrangements must be made to transfer the balance of the 20/ 30% deposit within 30 days of signing. Also within this time frame the stamp duty must be paid, (this amount is equivalent to 1.50 per one thousand pounds based on the total selling price).

There will also be legal fees to pay, Investment Property In Cyprus Ltd have negotiated favourable terms with a number of solicitors so the fees for both buying and selling the properties is around 1% of the initial sales price of the units. The solicitor chosen acts independently on behalf of the client and although Power of Attorney is given, nothing is signed on behalf of the client without the client’s prior approval.

There is nothing else to consider until the time of selling arrives, usually 10-12 months after purchase, then Investment Property In Cyprus Ltd will market and sell the property on behalf of the client. The costs involved after selling are just a sales commission of 5% of the new sales price of the property, plus a cancellation fee payable to the developer of a flat rate 500CYP. This covers admin costs in the cancellation of the first contract and re-issuing of a new contract for the new purchaser.

The profit made, less these expenses, is passed on to the investor plus the return of their initial 20/ 30% deposit.

WHAT IS THE POWER OF ATTORNEY FOR?
Most of our investors are non resident in Cyprus and so will not be available to sign the documentation at the appropriate times. In this case, and as the documents have to be signed in Cyprus, by giving a solicitor the power of attorney, you give them permission to sign on your behalf. However, they will also fax or e-mail to you copies of what they are about to sign to get your approval prior to signing the original documents.

IS THERE ANY GUARANTEE THAT THE PROPERTY WILL BE RE-SOLD?
Of course there can be no guarantees when dealing with the re-selling of investments of any kind, one of the reasons that Investment Property In Cyprus Ltd instigated these investor programmes is because of the lack of availability of this type of property in Cyprus. We are confident we can re-sell them to the buy to let market as well as securing long term contracts for renting to major tour operators. If the client so wishes we can agree an exclusive agency agreement, at the time of selling, that enables Investment Property In Cyprus Ltd to market the property at the appropriate time after agreeing an exit strategy with the client. There is a high demand and short supply for these properties in the areas selected and we are confident of re-selling.

WHAT IF IT STILL DOES NOT SELL?
In the unlikely event that the apartment has not been sold by the time 75% build complete is reached then the developer can only charge interest on the amount outstanding. (usually around 6-8% p.a.). The contracts are such that the client will not be forced to take a loan to pay the next stage payment. If they wish to then Investment Property In Cyprus Ltd can help arrange a loan for them and it is usually found that the rental income derived from the apartments covers the cost of such a loan.

CAN WE SEE THE PROPERTIES?
When we launch a new Project it is usually sold off plan within a 8 week period. At this time we normally have just the plans and elevations to go by. An artist impression is sometimes available but often this is not for 6 weeks or so after the launch. This is because the project is launched immediately after planning approval has been granted and prices agreed. Only at this point do we commission for the artist impression, hence the delay.

We do have similar projects that have been completed that those clients wishing to inspect can come to Cyprus and do so. It must be pointed out that these investments are very popular and sell quickly. Any delay in reserving will usually end in disappointment and the client missing out on their chosen properties.

Please feel free to contact me direct if there are any further questions you have.

CHERRY CLIFT
Contact me direct - Click Here

www.investmentpropertyincyprus.com