Cyprus, the Mediterranean island, is fast turning into a haven for property investors because of its inviting climate and serene locales. Initially, foreign tourists would flock to the resorts and avail of the holiday packages they offered. Of late, however, holidaying crowds are showing a preference for private apartments and villas. This together with the slackening of legal formalities, tax benefits, etc. has changed the holiday property market scenario.
Foreign nationals are increasingly taking interest in real estate purchases in Cyprus. The recent rise in off-plan property purchases is the aptest example of this positive move. Off-plan Property Investment is best interpreted as investing for property direct from the architect’s drawings, as opposed to investing for a finished building. People from different parts of Europe are making an off-plan investment for property in both the Northern and Southern parts of Cyprus. This involves making investments for construction projects whose plans are through but whose building work has not been completed.
Benefits Of Off-Plan Property Investments
Investing so early in a building project can indeed be risky. But again, if you seek advice from professionals, off-plan property investment in Cyprus will promise you great many benefits:
Off-plan investment for property usually involves making a minimum initial deposit to secure a high-value asset. This is a great advantage indeed because the returns on your initial investment will be huge. By finalizing the deal with the initial payment, you will be securing a purchase at today’s rate. By the time the building will be complete, its capital value will increase manifold times.
Buying off-plan property in Cyprus also entitles you to receive reasonable discounts from the developer. If the property you are thinking of purchasing is large enough, you can get massive discounts of even upto15% direct on the property value.
Follow-up or mortgage payments are generally not demanded. Even if you are required to make any payments, the stage payments are rather small and you will easily be able to afford the installments.
For those of you who are looking for a sweet home in Nature’s paradise like Cyprus, the off-plan investment will be a great opportunity to give shape to the house you have been dreaming of. Your involvement with the project from the very initial stages will give you every opportunity to plan and make necessary alterations in the internal and external decor of the building. Your house will be your heart’s content and you will take pleasure in the decision of making an off-plan investment.
If you are one of those who seek financial gain in every step you take, Cyprus is again the place to be for investment in property. Property prices are increasing at a rate of around 20% per annum in Cyprus. The low initial payment and the stage payments method of funding the construction work will prove very advantageous. Regular real estate investors do not make the final-stage payment (because this happens to be the biggest payment) instead earns huge profits by releasing the property for resale. This, of course, involves risks. Actually, the property market does go up or down and only the industry experts understand market trends very well.
Risks Involved And Ways You Can Tackle Them
As stated initially, off-plan investments do involve risks. It is highly advisable that you go ahead with investing only if you have a sharp enough brain to detect the loopholes. Real estate market frequenters who know the ropes of the trade very well can help you strike profitable off-plan investment deals.
An off-plan investment for property may lead to your undoing if the developer abandons the project midway because of financial or any other difficulty. The best way for you to proceed will be to enquire into the developer’s financial status before you enter into any agreement with him.
A thorough review of the developer’s previous projects is also recommended. This will give you a fair conception of what the developer is capable of and whether he is up to the task you are entrusting him with or not.
In Cyprus, the property trade market necessitates developers to produce proof of their financial soundness and professional renown and so these should ideally be part of the contract.
Another important factor, which all intending to get involved in off-plan property investment should especially take care is that there is no place for verbal assurance in the real estate business. Actually, making off-plan property purchases means that you do not really have the title deeds drawn in your name during the construction phase. If anything happens to the developer or he involves in some fraudulent deal and re-mortgages the property, you will be utterly ruined.
The only help in such a case is that whatever agreement you enter into has to be on paper penned down and duly signed by all parties involved. Only a watertight contract can render your investment safe and secure protecting both your money and your rights all throughout the construction process. Engaging a good lawyer will also help your cause for he will then take care of all legal formalities. Also make sure to have some legal guarantees covering the structure of the building for five or ten years.
Never invest in a property that is yet to receive permission for its structural plan. The plan is the only lead, which is going to give you an idea as to how the neighborhood will look, what other structures will come up, etc. This is especially important in areas where rapid and large-scale construction is underway. You may not find any fault with your particular developer but nearby buildings, etc. may harm the aesthetics, more so your privacy. These problems can easily be avoided if you take the help of a registered plan, which will have all details marked out properly.
Lastly, the rather lengthy process of construction is often viewed by many as a demerit of the off-plan investment method for property purchase. Again your involvement with the project will little bit speed up the project. And if nothing, a little wait for the house of your dreams or for some real easy money can make the waiting period short.