Questions About Buying

Some frequently asked questions and answers about the buying process in the Turkish Republic of Northern Cyprus

Yes, Northern Cyprus is a safe country to invest and own property! Many visitors decide to make a home in Turkish Republic of Northern Cyprus for full-time or part-time living in this charming former British Colony where property is extremely affordable, English is widely spoken and where over 10,000 British residents live in a virtually crime-free zone happily alongside a multi-cultural population. New state of the art medical care, six international Universities plus new schools (teaching in English) and modern leisure facilities are now attracting ex pat residents and their families from all over Europe and the Middle East.

Buying a property in North Cyprus should be an enjoyable process and at Turgay Ersalici Real Estate we want to the buying process very simple and easy.  To reserve a property once on the island it is customary to pay a non-refundable deposit of £1,000 – transferable to another property with the same owner or developer. 

This can be paid to your lawyer or directly to the seller.  However, many people like to reserve prior to flying out to view.   To ensure your total peace of mind, if you wish to reserve prior to your visit, we may negotiate a unique 7-day refundable deposit which can be paid prior to your visit to North Cyprus giving you time to fly to see the property.  We pride ourselves on our ethical approach and we would strongly advise against you doing business with anyone who asks for a non-refundable deposit prior to your visit.

Understanding the Northern Cyprus market is the key to making the right investment choice when buying property on the island. Normally you will then be given 14 days from the date of signing the contract to pay a more substantial deposit, normally around 15- 50% of the purchase price, unless it is a re-sale or existing property. We will always negotiate on your behalf to obtain the most favourable payment terms.

Finding a reliable, profitable buy-to-let property in the Turkish Republic of Northern Cyprus that generates healthy returns can be an exciting investment. The Northern Cyprus property market is hot. If you’re thinking of getting into property ownership so let property, now is the time to do it. 

Capital appreciation is between 10% and 15% in Northern Cyprus, rental income from residential properties is between 3% and 5% and rental income from commercial properties is between 5% and 8% in Cyprus. If you compare the prices between residential and commercial, residential properties are cheaper than commercial properties.

Many overseas buyers of North Cyprus property will wish to take out a mortgage. This means that a mortgage is normally sought from foreign lenders, and these lenders will look for their main security on a Purchaser’s property.

Turgay Ersalici Real Estate offer customers mortgage options at attractive rates, typically over a period of 10 or 15 years. The Mortgage is normally secured on the North Cyprus Property. We usually require a certain deposit, with the balance payable by way of Mortgage. Applying for a Mortgage is similar to the procedure in the UK and other European countries.

Occasionally investors who frequently purchase property without visiting the island can set up power of attorney remotely via an Embassy or any lawyer (with a legal partner in the TRNC). Preparing a limited power of attorney with an authorized legal counsel in the TRNC is an easy and very fast process. It is not a risk for you to have only one attorney and power of attorney to purchase the property.

Please contact us if you are unable to visit the TRNC and still wish to purchase property or invest in real estate. At Turgay Ersalici Real Estate we want to ensure that your interests are maximally protected the whole transaction and we can provide a list of recommended and trusted lawyers in North Cyprus who have the best prices, qualifications (often British trained), track record and efficiency.  During your inspection visit or viewing day we can arrange a meeting with one of these.  During this period you should provide your lawyer with full information about the property or properties you have chosen plus all relevant details about any informal agreements you have made with the vendor regarding price, payment schedule and included items.

Visitors who want to buy property in the TRNC should follow these steps carefully if they want to make a purchase when they return home. If you are away from Northern Cyprus for a long period of time, this will be important for you as the attorney allows you to sign documents on your behalf. Giving this power of attorney is usually done free of charge and it makes all the important purchasing processes possible without having to return to Cyprus from the contract register.

There are three main taxes which must be paid.  The first is a 0.5% stamp duty (current at July 2014) if paid within one month of the contract date.  Please note, this is currently a very low rate – so we recommend buying sooner rather than later as this rate may rise.  If it is not paid within this time, it increases until it becomes 1.5% if paid after 6 months. You will have the option to pay upfront or pay on transfer of title and pay a higher rate.

Once your purchase permission has been granted, your legal advisor will notify you and then fill out all of the necessary land registry valuation forms for the valuation of the property. It is usually at this point that taxes will be payable.   The taxes are Transfer of Title Fee (again currently very low at initial 1% option for your first purchase).  This is a % of the contract sale price.  In addition, if you are buying a brand new property from a developer, you will usually have to pay 5% VAT to the government. For more detailed information on taxes, please ask us for a copy of our guide to the taxes payable on property transactions.

Before the title deeds to the property can be registered in your name, you will need to obtain what is called Permission to Purchase (often written as P2P in shorthand) from the TRNC Council of Ministers.  (It is rare for this to be denied – the only situation is usually if the prospective buyer has a police record in their country of origin.  This process is a positive one as it protects other TRNC residents by excluding those with a criminal history). 

The timescale for obtaining this is currently around 6- 9 months, during which period your ownership is fully protected by the Registration of your contract of sale at the land registry, which must be carried out by your legal representative within 2 weeks of the contract being signed.    If a clause is inserted into the contract, it is possible to resell your property before taking title – this is a feature which many investors take advantage of.

Your lawyer will prepare a Contract of Sale to safeguard your interests. If your property is a new build, the Contract of Sale will include all important terms such as plot number, plot size, price, payment schedule, completion date with penalty clauses for late completion. All floor plans and specifications will be attached to the contract to ensure that the vendor is bound to carry out the construction work in accordance with these. The contract will be sent to both the vendor and the purchaser for review. When both parties are happy the contract will be signed.  Your lawyer will sign on your behalf only when you are completely happy.

Contact us for our recommended list of lawyers who are all qualified to give you advice on buying process in North Cyprus. If you are planning to visit North Cyprus each time for 90 days or less on each visit and you do not intend to work in the country, you only need the 90 day visitor visa which is given automatically to those of all nationalities upon arrival at Ercan international airport (accessible via Turkey for all nationalities) or at the border to the TRNC if you are crossing from the South of Cyprus (please note that to enter the South of Cyprus you need to be a European, American or Commonwealth Citizen or hold a Schengen visa). However, if you are planning to spend regular periods of time longer than 90 days in the TRNC you must apply for a temporary residency permit. 

Under the laws of the Turkish Republic of Northern Cyprus foreign property investors are allowed to hold one property in their name of up to 5 donums or just over 1.5 acres (5 donums of land OR a house on land of up to that size), although multiple properties are easily and frequently purchased by foreigners by setting up a company or trust registered in North Cyprus or finding a trusted nominee to hold title for you.   
 
Example (Husband and wife qualify for one property – although if they have different passport surnames, they may be able to have two).  Properties can be registered in the name of an individual or a company.  Contact Turgay Ersalici Real Estate advisors for advice on how to use trustees or setting up a company in Northern Cyprus that could hold the title to the property have you purchased – this can also have tax benefits.