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North Cyprus Real Estate by New York Times, 22 April 2009


Posted on 2009-06-09 00:01:40


New York Times selects North Cyprus Property as top destination for Great Homes and Destinations...

International Real Estate in North Cyprus
New York Times, 22 April 2009, Great Homes and Destinations.

Built in the 19th century by a wealthy Ottoman family, this property offers a 350-square-meter (3,767-square-foot) main house and two guest cottages. It is in the center of Ozankoy, a village in the foothills of the Kyrenia mountains, five miles east of the coastal town of Kyrenia, whose historic harbor is a popular destination.

The main house, built of Cypriot stone and with a timber roof, has three bedrooms and three baths, a large kitchen and dining room. Though it has been renovated several times, and now has air-conditioning and heating, it retains its rustic charm, including high ceilings with exposed beams and Ottoman windows. It is being sold furnished, with antique furniture and Turkish carpets.

The first guest cottage has about 130 square meters (1,399 square feet) of space, with two bedrooms; the second covers 50 square meters (538 square feet) and has one bedroom. Also on the property are a swimming pool, gardens with mature avocado and orange trees, original stone paths, and a small structure with a Turkish bath and two earthen ovens for outdoor cooking.

The 3,000-square-meter (0.75 acre) property, surrounded by stone walls, is reached through a large wooden door. Restaurants and cafes are within walking distance, and a beach is three miles away. Ercan International Airport is about 30 minutes away.

MARKET OVERVIEW

Real estate prices in the northern portion of Cyprus are relatively low compared with those elsewhere in the region, said Cameron Deggin, a director at Place Overseas, a London-based real estate firm. This is partly because of the complicated political situation on the island, which has been divided since 1974.

The southern two-thirds of the island is internationally recognized as the Republic of Cyprus and is predominantly Greek Cypriot. The northern third, which is home to a Turkish Cypriot community, calls itself the Turkish Republic of Northern Cyprus, though it is recognized by Turkey alone. Clashes over the years led the United Nations to set up a buffer zone, also known as the green line.

From 2002 to 2007, the real estate market in the northern part of Cyprus was “extremely buoyant,” Mr. Deggin said. Before the boom, a typical three-bedroom villa with a garden and pool cost £40,000 to £50,000 ($58,208 to $72,760); today it might run £80,000 to £100,000 ($116,416 to $145,520), he said. Most real estate in north Cyprus is priced in British pounds, Mr. Deggin said.

In 2003 the increase was fuelled by the easing of travel restrictions across the green line.

Peace talks to unite the island have resumed recently, though parliamentary elections held in northern Cyprus on April 19 suggest a tough road ahead. And since the start of the global recession, prices have softened 10 to 15 percent, said Mark Unwin, managing director at Unwin Estates, a real estate company based in Karaoglanoglu, a suburb of Kyrenia.

WHO BUYS IN THE NORTHERN PART OF CYPRUS

Cyprus is a former British colony; the majority of foreign buyers in the northern part of Cyprus are British, but there is a growing population of Russian buyers, Mr. Unwin said.

BUYING BASICS

Foreign buyers are limited to new properties smaller than one donum (14,400 square feet) or pre-existing homes built on five donums (72,000 square feet), said Mustafa Sener, a lawyer in Kyrenia who handles real estate. Buyers are also limited to owning one property, he said. They are required to obtain a special ownership permit, in a process involving many local agencies and Interpol, and sometimes lasting as long as two years, according to Mr. Sener. (While awaiting approval, buyers can take occupancy, Mr. Unwin explained.)

Lawyers’ fees are about £1,350 ($1,965), Mr. Sener said. (The use of a lawyer is generally recommended.)

Given the delicate political situation, newcomers to the market in northern Cyprus should also be aware of the type of title deed they buy. If the island were reunified, Greek Cypriots who owned property in northern Cyprus before fleeing south might come forward to seek compensation, Mr. Sener said.

To avoid complications, he advises cautious buyers to seek a property with a Turkish title deed, which indicates ownership by a Turkish Cypriot before 1974. This title is internationally recognized and carries no risk to the buyer.

Still, Mr. Sener believes that any property developed since 1974 carries minimal risk, as potential compensation to Greek Cypriots would be based on the pre-1974 value of the land alone, which is likely to be nominal.

Other costs include a 0.5 percent stamp duty, a 5 percent value-added tax and a 6 percent land-registry fee, which can be reduced to 3 percent for first-time buyers, Mr. Sener said. Real estate agents’ fees are paid by the seller and typically range from 3 to 5 percent, Mr. Deggin said; mortgages are uncommon, and a majority of foreigners pay in cash.

LANGUAGES AND CURRENCY

Turkish; Turkish Lira (1 Turkish lira equals 60 cents)

TAXES AND FEES

Property taxes are about £2,500 ($3,638); the house has a caretaker, whose annual salary is about £5,000 ($7,276), said Mr. Deggin.

CONTACT

Cameron Deggin, Place Overseas, www.propertycyprussales.com, 011-44-20-8371-0059







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