Buying property in North Cyprus can seem very attractive price-wise. Forbes ranked North Cyprus as the top destination for best beachfront buys in 2021.
However, it’s highly recommended to rent first and get to know locations and the quirks of the property market before you commit.
Is it safe to buy a property in North Cyprus?
There have been some changes to the law in recent years in the North Cyprus property market, making buying a property in the TRNC much safer.
Nevertheless, your own due diligence and knowing the process are vital. A reputable estate agent is also a crucial part of the deal.
Tips on property hunting in North Cyprus
Rather than being tempted by an off-plan offer, you are far better off looking at the pre-constructed stock that is either being sold as a resale or something that is completed on an already finished and inhabited site.
Rent first! Why not rent a property in Cyprus first to get a feel for it? And to see whether you would be comfortable committing to the island for the long term. After all, property is a long-term commitment if you buy it.
What’s more, there is an ongoing dispute between the Greek Cypriots in southern Cyprus and the Turkish Cypriots in Northern Cyprus over who actually owns the land across both sides of the island on which the property is constructed.
For example, before the 1974 conflict, the land that the Larnaca International Airport is now constructed on belonged to a Turkish Cypriot family.
Following the cessation of hostilities and the division of the island, the Turkish Cypriots inhabited all the land in the North, and the Greek Cypriots all the land in the South. Now, generations later, there is still arguing about who owns which land.
As a foreigner, you may have absolutely no desire to get involved with this in-fighting as it really is none of your business. In this case, rent a property or buy a home with the ‘right type’ of indisputable title deeds.
Can foreigners buy a property in North Cyprus?
Foreigners wishing to purchase in North Cyprus are allowed to acquire one property per person or up to one donum of land (1,338 sq meters or 14,400 sq ft). This restriction does not apply when buying foreign or Turkish-titled property.
To be able to purchase a property, you have to get permission from the Council of Ministry, which is now quite a quick process.
If you want to buy multiple properties as an investment, you have to look at a trust solution and will definitely need professional advice.
Types of Title Deeds
There are several types of title deeds under which land and property are sold in North Cyprus, some of which are considered more desirable than others.
Property or land owned by Turks or Turkish Cypriots before the division of Cyprus in 1974 is sold under Turkish Title. Property that used to be owned by foreigners (Europeans or other nationals) before 1974 is sold under Foreign Title.
Both titles are internationally recognized.
TRNC Title (Kesin Tasarruf Belgesi – Absolute Possession Document) covers properties and lands that were given to Turkish Cypriot refugees in compensation for the land of similar size and value that they lost in the south following the war in 1974.
Should the two sides of the island ever reach a political agreement based on the United Nations’ Annan Plan, properties and lands covered by TRNC Title may be subject to claims for compensation from former Greek Cypriot owners.
However, the compensation will most likely be based on pre-1974 values and be minimal, especially if the lands in question were derelict or grazing lands before 1974.
Most new developments in the TRNC happen on such land.
TDM Title, or “Turk Mali Degil” – Not Turkish Title, covers the land that was owned mostly by Greek Cypriots before 1974 and was given to Turkish settlers after 1975. Purchasing a property covered by TDM Title can be a higher risk.
Legal process
The process of purchasing a property in the TRNC is quite straightforward. As a rule, two lawyers are involved in the purchase – from the seller’s and the buyer’s side.
A buyer and a vendor agree on the price, and the agreement is drawn in English. The agreement specifies the price agreed, completion time, and any other conditions of sale. At this point, the buyer is required to put down a 10% deposit.
The buyer’s lawyer then applies on behalf of the buyer for a permit from the Council of Ministers to purchase the property. When the permit is obtained, the buyer pays the rest of the price, and the transfer of all rights of the property into the name of the buyer is signed by the vendor. The transaction is officially complete.
Costs, fees, and property taxes
When purchasing property in Northern Cyprus, you will encounter several taxes at different stages:
During the purchase:
- Stamp duty: A fee of 0.5% of the property’s contract value, payable when signing the sales contract.
- VAT: Amounting to 5% of the property’s contract value, it’s due within three months before receiving the keys.
- Transformer charge: Maximum £3,000, covering utilities like electricity, water, and telephone lines.
- Transfer fee: Equal to 12% of the property’s value, calculated based on the sales price that is stated in the contract. For foreign buyers, it’s split into two payments: 6% during property registration and the remaining 6% upon transferring ownership.
After the purchase:
- Annual property tax: Calculated at a rate of 1.25TL per square meter of the property’s covered area, excluding open terraces. Paid annually to your local municipality.
- Annual tax on cleanliness: This tax changes on an annual basis, but it’s quite small.
Additional taxes:
- Income Tax on rented properties: If you rent your property, you must pay 13% tax if the rent amount is in GBP and 10% if the rent amount is in TL.
- Capital Gains Tax: This tax applies when selling property. For professionals, it amounts to 6.25% of the property value. Individuals can enjoy a tax-free sale for their first property if the land is up to 1 donum (approximately 14,400 sq. feet). Beyond that, a 3.5% tax is applied.
Make sure to budget a minimum of £1,000 for your solicitor’s fees.
You might find useful:
- If you have any questions about retiring to North Cyprus, please refer to our Retiring To North Cyprus FAQs page.
- Living In North Cyprus – a detailed guide to moving to North Cyprus, including residency, healthcare, amenities, travel options, education, etc.
- The Best Places To Live In North Cyprus (TRNC) – most favorite expat locations in North Cyprus
- The Expat Guide to UK Pensions Abroad – detailed information about your state, workplace, and private pensions when you retire abroad; your options, tax implications, and opportunities if you transfer your pension pot abroad or leave it in the UK
- Didn’t find what you were looking for or need further advice? Comment with your question below, and we will do our best to help.
