Buyer Guide

Set in the far west of the Mediterranean and part of the third largest Island, North Cyprus is an area that is demanding attention, right now, for all the right reasons.

A former British strong holding, where English is still widely spoken and cars are driven on the left, yet the far eastern influence brings a mystique and mystery rarely found in such an environment.

Due to its strategic location, Cyprus has been at the forefront of many historic battles over the past centuries, which has contributed to not only its beauty and historical importance but the ready acceptance of different cultures.

The average price of property is around £1000GBP per m2 offering exceptional value for money compared to the prices currently being offered on the south of the Island and the rest of Europe.

Currently, the North and South of the Island are in talks to find a way forward and open up trading with the rest of the world, Turkey and Greece. North Cyprus are already starting to see an increase in tourism and significant investment from Turkey in the form of infrastructure, 5 star hotels, health tourism and the revolutionary water pipeline from Turkey that is bringing unlimited water to the Island.

It's best to give us as much detail as possible before your arrival in Northern Cyprus in order that we can discount any properties that really come nowhere near your requirements.

Consider the frequency with which you will use the property, think about distances from airports, schools, rental potential and long term investment. Acquiring the home of your dreams can be stress-free providing the research is thorough. If unobstructed views are a priority, consider homes which are beachfront or on elevated positions and always ask if further development is planned for the area. Ascertain a budget and remember to add approximately ten percent of the purchase price to cover all other fees i.e, Transfer of Title, Stamp Duty and VAT.

Obviously buying through a registered Estate Agent will give you complete piece of mind. Beyler & Co are fully registered members of the Turkish Republic of Northern Cyprus Estate Agents Union – Registration No: 065.

We are committed to making your dream home in North Cyprus as stress free as possible. Beyler & Co Property Negotiators will show you exactly what you are looking for, carefully planning your viewings according to your personal requirements. From the moment you decide which property in North Cyprus is for you right up until you get your keys and settle in, we are YOUR North Cyprus Estate agent and will assist in any way we can.

North Cyprus offers superb build quality and much improved infrastructure, the world class Korineum golf course and one of the best climates in Europe just to name a few.

North Cyprus properties offer fantastic value for money giving potential buyers’ high returns.

All TRNC deeds are classified as TRNC freehold.

A local solicitor should be appointed to deal with your purchase. They will be able to assure you that your intended freehold is legitimate and clear of any debts. Beyler and co have a list of recommended lawyers to assist you in your selection.

This TRNC Freehold title deed can be broken down to four possible variants, one of which will apply to your purchase. These are:

Pre. 1974 Foreign Title.
This applies to land or immovable property that was owned by a foreign national before 1974.

Pre. 1974 Turkish Title.
As the name implies, this applies to land or immovable property owned by a Turkish Cypriot before 1974.

TMD Title.
This applies to land given by the government to Turkish and Turkish Cypriot people after 1974 for military service and to encourage settlers. This was to promote and encourage economic progression.

Exchange Title. (Esdeger)
This applies to land or property awarded by the government to a Turkish Cypriot in exchange for land or property they were forced to leave behind when fleeing the south in 1974.

Negotiating the Purchase
Once a North Cyprus Property has been chosen, the first step is to make a verbal offer. The purchase terms and price may need to be negotiated with the seller and working in consultation with you, Beyler & Co will proceed on your behalf until a price is agreed. You may wish to vary final completion dates, or terms of payment.

Appointing a lawyer
North Cyprus Estate Agents, Beyler & Co can recommend several trusted lawyers in North Cyprus who are fluent in your language and do not represent the seller or estate agent. They work solely for you. Your lawyer will provide the legal guarantees ensuring that the property you are purchasing in North Cyprus is bought free of encumbrances, charges, liens or debt and that all local taxes and community charges are paid up to date. Lawyers will tell you in advance what their fee will be – these vary from £1250 – £1500. For more in depth information please visit our Legal services and Lawyers in North Cyprus page.

Formalising the offer on the property: The Reservation Deposit
Once a verbal agreement has been made between parties, a reservation deposit will be required. Once paid, Beyler & Co will formalise the offer in writing to the purchaser, seller and their respective lawyers. The reservation deposit guarantees the property is taken off the market and is reserved for you at the agreed, fixed price. Reservation deposits are usually non-refundable, unless it is specifically conditional upon certain factors e.g. awaiting planning permission documentation.

Exchange of private Contracts
The next step in the process is to exchange private contract of sale. This normally takes place within two weeks following formal acceptance of the offer. Your lawyer will have completed the necessary searches of the property and a draft contract of sale will be drawn which will reflect all the agreed terms of the offer and sale. The contract will clearly state dates when payments will have to be made. Usually for an off-plan property the first stage payment will be anything from 10 – 25% of the purchase price. All subsequent payments will be conditional upon completion of works.

For more information on the legal aspects of purchasing or real estate in North Cyprus please visit our legal and lawyers page.

Appointing a lawyer
North Cyprus Estate Agents, Beyler & Co can recommend several trusted lawyers in North Cyprus who are fluent in your language and do not represent the seller or estate agent. They work solely for you. Your lawyer will provide the legal guarantees ensuring that the property you are purchasing in North Cyprus is bought free of encumbrances, charges, liens or debt and that all local taxes and community charges are paid up to date. Lawyers will tell you in advance what their fee will be – these vary from £1250 – £1500. For more in depth information please visit our Legal services and Lawyers in North Cyprus page.

Formalising the offer on the property: The Reservation Deposit
Once a verbal agreement has been made between parties, a reservation deposit will be required. Once paid, Beyler & Co will formalise the offer in writing to the purchaser, seller and their respective lawyers. The reservation deposit guarantees the property is taken off the market and is reserved for you at the agreed, fixed price. Reservation deposits are usually non-refundable, unless it is specifically conditional upon certain factors e.g. awaiting planning permission documentation.

Exchange of private Contracts
The next step in the process is to exchange private contract of sale. This normally takes place within two weeks following formal acceptance of the offer. Your lawyer will have completed the necessary searches of the property and a draft contract of sale will be drawn which will reflect all the agreed terms of the offer and sale. The contract will clearly state dates when payments will have to be made. Usually for an off-plan property the first stage payment will be anything from 10 – 25% of the purchase price. All subsequent payments will be conditional upon completion of works

Vendor/Purchasers' VAT (KDV)
VAT (KDV) is payable to the Tax Office or to the Vendor only if he/she is considered a professional Vendor. All construction companies are professional so therefore VAT applies. However, a foreign national would not be considered a professional so if you are purchasing a resale property registered to a non TRNC Citizen then no VAT is applicable. VAT is currently 5% and normally paid at the time of purchase.

Purchaser's Stamp Duty
Stamp duty is payable to the Tax Office – currently 0.5% of the contract price if paid within 21 days from the date of signing rising to 1.5% if paid after this time. Different taxes apply to gifts of property for no consideration and transfer of property between family members.

Purchaser's Transfer Fee
The transfer fee is Payable to the North Cyprus District Lands Office on transfer of title. Currently the rate is 6% of the District Land Office valuation. However, each person has a once in a lifetime option to purchase a property at a reduced rate of 3%. The transfer of title will not take place until the purchase permit has been granted.

Vendor's Capital Gains Tax
Capital Gains Tax is payable to the Tax Office by the Vendor – currently 3.5% if the vendor is not a professional i.e. private homeowner not developer or construction company. Again each individual has a once in a lifetime option to sell one property without paying any taxes. If the Vendor is classed as a professional then the Capital Gains Tax rises to 6.25%.

All the above taxes are based on either the contract price or the District Lands Office valuation.

GUIDE TO PURCHASING PROPERTIES IN THE TURKISH REPUBLIC OF NORTHERN CYPRUS


The current property laws in Northern Cyprus dictate that Non-TRNC citizens are entitled to take title to only one property or parcel of land up to a maximum area of one donum (3rd of an acre) per person (per person refers to, husband, wife and any unmarried children over the age of 18).

Before the title deeds to your North Cyprus property can be registered in your name, you will need to have permission from the TRNC Council of Ministers. This is explained in more detail below. If you wish to take title to more than one Northern Cyprus property, or a property in North Cyprus with over one donum in area, we can give you advice on using trustees or setting up a TRNC Company to hold the title to the properties for you.

The conveyance procedure followed by the many law firms are as follows;

an initial meeting with you to obtain information about the North Cyprus property you have chosen and any informal agreements you have made with the vendor regarding price, payment schedule and included items. This stage may also involve giving a power of attorney from you to the lawyer to ensure they can act on your behalf to sign documents if you are away from Northern Cyprus for long periods of time; the preparation of Contract of Northern Cyprus Property Sale to ensure your interests are safeguarded. The Contract of sale will include all important terms such as plot number, plot size, price, payment schedule and completion date with penalty clauses for late completion. Attached to the contract will be floor plans, specifications and selling Agent's advertising material to ensure that the Vendor is bound to carry out the construction work/sale of the property in accordance with these. At this stage they will conduct the necessary land registry searches on your behalf to ensure that the vendor is the registered freehold owner of the property and that there are no mortgages/charges, injunctions or other encumbrances on the property. They will also check that the building permission for the construction has been obtained if you’re buying off plan or a brand new property. The contract will be sent to both the vendor and the purchaser for review. When both parties are happy the contract will be signed; payment of stamp duty: Under new regulations, the North Cyprus Tax office are requesting to see a copy of the North Cyprus Property Sale Contract prior to transfer of title with all stamp duty paid up. North Cyprus Stamp duty is payable at 0.5%of the contract price if paid within 21 days of the contract date. If it is not paid within this time it increases to 1.5%. You will have the option to pay upfront or pay on transfer of title at the higher rate. We would strongly advise you pay this on signing of contracts to avoid complications later; application for Permission to Purchase: Every foreign purchaser must go through the ‘North Cyprus permission to buy’ process. This is a lot simpler than it sounds but can take around 18 months to complete. It is worth noting at this stage that the permission process does not prevent you from moving into your North Cyprus property or leasing the property for a rental income or even selling the property on. A new law was passed in Northern Cyprus at the beginning of 2008 whereby signed and stamped sales contracts are now lodged at the District Lands Office in order to protect the purchaser from the title owner borrowing or selling the property to another party. In short the purchaser is 100% protected until title deeds have been registered into their names;

Note: It is now necessary for all foreign nationals to apply for a police clearance report before permission to purchase can be applied for. This can take a few weeks but it is best to be prepared before you arrive in North Cyprus. The following link will provide you with instructions and download www.disclosurescotland.co.uk/disclosureinformation/index.htm

Whilst processing your purchase permit application, the Council of Ministers will check with the military and the immigration authorities and provided that these are positive i.e. the property is not overlooking a military installation and you are not a convicted criminal on the run; the permission will be granted. In the unlikely event that your application is refused, you will be able to nominate any other person to take title to the property on your behalf and hold it on trust for you; once your purchase permission has been granted your lawyer will fill out the necessary North Cyprus Land Registry Valuation Forms, work out and notify you of taxes payable and finally transfer the property into your name/s. The taxes are calculated based on the Northern Cyprus Land Registry Valuation and are currently at the following rates:

Land Registry Transfer Fee – 6% (however, every purchaser has a once in a lifetime option to reduce this fee from 6% to 3%. At the time of transfer you will be asked whether you wish to use your option and if so you only pay 3%)

VAT – 5% (This is only payable if the vendor is classed as a professional i.e. developer, construction company or private individual that has sold more than three properties). At this point its worth noting that unless you are buying a property that is already registered in a foreign nationals name then and only then is it unlikely you will pay VAT.

Stamp Duty – 0.5% rising to 1.5% if not paid within 21 days from the date of your Property Sales Contract.

The taxes will be paid and the title deeds will be registered in your name. If you have left your lawyer a power of attorney all of this can be dealt with without you being required to travel to the TRNC. Your lawyer or Agent will then collect and keep the title deeds for you until you are ready to collect them.

English Speaking Lawyers Naomi Mehmet LL.B. (Hons) Advocate Muharremoglu Apt No 1, Sariyer Sokak, Girne, Mersin 10 Turkey Tel: (009) 0392 816 0440 Fax: (009) 0392 815 0702 Email: [email protected] Web: www.nmplegal.com

Currently it is possible for TRNC nationals to borrow money for property purchase. The mortgage/loans are normally over a maximum of 10 years.

Recently, some of the Banks have also introduced property loans to foreigners who have their title deeds in their name, therefore, more like an equity release than a mortgage.

If you do require some finance to purchase your property you should look at new properties as many of the developers offer payment plans. Down payments range from 20% to 80% with terms over a normal maximum period of 10 years.

Occasionally, a private vendor may agree to take payments over a short period of time but this is rare, so it is always advisable to have your funding in place.

Currently it is possible for TRNC nationals to borrow money for property purchase. The mortgage/loans are normally over a maximum of 10 years. Recently, some of the Banks have also introduced property loans to foreigners who have their title deeds in their name, therefore, more like an equity release than a mortgage.

If you do require some finance to purchase your property you should look at new properties as many of the developers offer payment plans. Down payments range from 20% to 80% with terms over a normal maximum period of 10 years.

Occasionally, a private vendor may agree to take payments over a short period of time but this is rare, so it is always advisable to have your funding in place.