Photo credit: tmb2610
Cyprus has traditionally attracted tourism from the U.K. The main reasons being obviously the sun, the sea and the familiarity felt by people from the U.K: as Cyprus was a British colony until 1960, English is spoken widely and even cars are driven on the right (i.e. the left) side of the road.
Once the holiday is over, people often think of converting Cyprus into a permanent holiday destination or even a place to live after retirement. In this context, they consider buying a piece of property in Cyprus over other Europe real estate, from the thousands built by local developers. This is often when the dream can turn into a nightmare.
The purpose of the present article is two fold. The first is to point out what one must do before purchasing to makes sure everything runs smoothly. The second is what one can do if, unfortunately, things have not gone as planned.
Before a transaction, it is important that the purchaser distances himself from the developer. Although costs may rise somewhat, it is advisable that he engages his own experts, such as a lawyer and architect, and not use those proposed by the developer. These two, working together, will make sure that all the documentation is in order and that the property is built according to the agreed time frame and corresponds to what has been agreed to be purchased.
Most, if not all, the problems faced by purchasers – from my experience – are a result of not doing this. For example, the documentation did not afford the purchaser the required legal protection, or the developer did not build the property in accordance with their agreement. In all of these cases, the purchasers used lawyers and architects acting for the developer.
When the purchaser has unfortunately found himself in trouble after the transaction, the problems usually relate to the following issues:
(a) The loan agreement with the bank,
(b) The purchase agreement with the developer,
(c) The Power of Attorney through which the purchaser has appointed someone to represent him in Cyprus,
(d) The agreement for the payment of property managementfees to the developer, or
(e) The assignment agreement (if any) between the purchaser, the bank and the developer in relation to the purchase agreement.
Obviously, this is not intended to be an exhaustive legal opinion as to how to tackle any problems that may be caused by the above. Each case depends on its own facts. It is enough to say at this stage that in the first instance, legal advice must be sought in order to examine the legality of the above documents. (For example, if the Power of Attorney was not signed in accordance with the law then it would be invalid, along with all the other documents based on it.)
Finally, I point out that Cyprus Law, which to a large extent is similar to English Law in this context, provides adequate security to would-be buyers after they have found themselves into trouble. It must be used correctly, though, and this depends on each individual and the course of action he chooses to follow.
The dream may have turned into a nightmare but all may not be lost after all.
This advice was contributed by Judicare
