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Troika backs down on Cyprus title deeds saga

04 March, 2014

The Troika of international lenders has radically altered the memorandum so that the 130,000 title deeds backlog will no longer be required to be cleared by the fourth quarter of this year, as had originally been planned.
It seems that only those cases where title deed issuance has been applied for plus another restricted category are now defined as ‘the backlog’. All those still dependent on developers who are reluctant or refuse to apply for issuance, or where developer double-selling or hidden mortgages are involved, will remain sine die (suspended, but can be recalled in the future) as victims of the mega Cyprus property scandal of the 21st century.
“There’s no real hope now of the market ever reviving as far as foreign buyers and investors are concerned,” a property owner in Larnaca told the Financial Mirror.
Or as Nigel Howarth, editor of Cyprus Property News http://www.news.cyprus-property-buyers.com/ notes, Cyprus developers are doomed and really ought now to look urgently for a new career.
In his article posted online “Troika back-tracks on Title Deed backlog”, Howarth argues that many who were hoping that agreement between the Cyprus Government and the troika of international lenders would result in their receiving their title deeds, pinned their hopes on the following statement contained in the Memorandum of Understanding, dated April 12, 2013:
“By Q4-2014, eliminate the title deed issuance backlog to less than 2,000 cases of immovable property sales contracts with title deed issuance pending for more than one year. The Cypriot authorities will enhance cooperation with the financial sector to ensure the swift clearing of encumbrances on title deeds to be transferred to purchasers of immovable property, and implement guaranteed timeframes for the issuance of building certificates and title deeds.”
However, Howarth said that this statement has been replaced in the latest Memorandum of Understanding issued following the troika’s recent visit to Cyprus with the following:
“Ensure that the title deed issuance backlog drops to less than 2,000 cases of immovable property units with title deed issuance pending for more than one year by Q4-2014 (backlog refers to (i) applications, (ii) units that are eligible for the “ex officio” issuance of title deeds, required certificates and permits).
“The ex-officio cases will automatically be counted in the backlog from the date the certificate of final approval is being issued by the respective Local or District Authority. Moreover, prepare a joint action plan to streamline the processes within the DLS and between the DLS, the Local and District Authorities and the Ministry of Interior Technical Services by Q2-2014.”
Nigel Howarth explained that this revised statement means that the MoU no longer refer to all the reported 130,000 properties that have yet to be issued with title deeds, but only to those where an application has been made to the Land Registry to issue its title deed or a Certificate of Final Approval has been issued.
Applications for Certificates of Final Approval and the issuance of title deeds are the responsibility of the developer and so any pressure that the original MoU placed on developers to act responsibly has been removed, Howarth added.
Furthermore, in this latest issue of the MoU the requirement: “The Cypriot authorities will enhance cooperation with the financial sector to ensure the swift clearing of encumbrances on title deeds to be transferred to purchasers of immovable property…” has been removed.
“This apparent back-tracking by the troika will not be welcomed and questions need to be asked,” he said.
“Perhaps the troika uncovered some ‘hitherto unknown facts’, in the same way that many property buyers uncovered ‘a hitherto unknown fact’ when they discovered they’d been duped into buying a home built on mortgaged land,” concluded Howarth.