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Property lifestyle changes

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Like many other things, most of our living requirements are changing, and they now seem to have a noticeable circle.

A young couple starts with acquiring an apartment with 1-2 bedrooms, then, depending on their financial ability, move on to a larger apartment and the more affluent than to a house.

Other than those with the financial support of their parents/family, the circle of housing described is the above for the majority.

This circle of housing, normal in other countries, in Cyprus, only the last 15 years has it appeared, since local attitudes did not find the change of homes acceptable, whereas moving from the parents’ house given on most occasions as a dowry, was not done.

Nowadays, the circle ends when the couple reaches the age of 65 (plus) and in cases where children no longer live with their parents.

Especially those who have built huge houses and spacious gardens, the “aged” couple does not wish to live in a house of more than 250 sq.m., whereas cleaning and keeping in shape a large garden is costly.

In addition, older house design units can also become a problem, as at the time (1980’s) design of adopting split level units with 2-3 steps at various levels.

The recent change is also affected by the prevailing economic situation since the family house was targeted originally to be left to the children (mainly the daughter).

However, now, most children find their parent’s houses costly to upkeep and outdated, requiring extensive modern improvements, and thus, new couples have no time/inclination/finance to take over.

In terms of age groups and based on our experience, the circle evolves as follows:

Young couple 25-35 years – Compact apartment of 2 (most preferred) or three bedrooms (for the more affluent).

Married at 35-45 years age – Larger apartment or small house

Living at 45-65 years – Larger house but at the late age children leave home.

The older couple, if it succeeds to sell/let their property, are looking for a central apartment close to shops and other facilities within walking distance, in the region of 150 sq.m. (max.)– either to buy or to lease it long term.

Changing times and living habits brought about a new housing requirement timeframe that did not exist before.

In the past, parents would displace themselves by giving away their house. Instead, they were accommodated usually in the rear part of a house named “subsidiary house” – an acceptable circumstance at the time but no more.

Now families are not as close as they used to be, there is an increasing tendency to place the parents in care homes (most of which are an embarrassment).

High-end retirement homes are not available, and we believe there is room and good demand for such projects.

Selling one’s house and moving into an organized complex with some facilities is needed, and we do not refer to those who are sick or disabled.

We wrote in the past that an ideal project was the Kermia Hotel at Ayia Napa which comprised of 2-bed bungalows with a common/central building accommodating a café/indoor pool/a meeting room – Now this hotel has been sold and placed into tourist use.

For such projects, however, we found that a rental/occupation fee of €2,000 p.m. is not unreasonable, and of course, it applies to those who have the financial ability to do it.

This, coupled with food/services, will end up to a total of €3,000 p.m. for two people.  It is reasonable in the sense that if the couple sells their house, the capital received should go against the rent/living expenses, but then the relevant project will bear no relation to those prevailing, but more on the lines of U.S.A. residential retirement projects.

Retirement

In a proposal that we have made, retired people could pre-let the leased property for 10-15 years, with the right to sell the lease balance should they have to or want to terminate.

We tend to think that this project is becoming more of a necessity as people tend to live longer (Cypriots live to 80 or more).

It is appreciated that the need will become an increasing one, and this alternative will benefit the parents and the children (who have no time for the parents).

In the past, parents would pass on their property to children upon death, but some made a mistake to transfer the property to the children before (in the hope that the children would look after them later on) – How wrong this is.

So nowadays, under the new law, parents have some safety; they can transfer the property, retaining a life interest.

The parents have the use of the property as long as they live (including rental, development) duly registered on the title.

Property with life interests is an asset for the parents and the children (be it much reduced in value depending on the parent’s age).

There are a couple of high-end residential projects in Nicosia, where full concierge and facilities are provided.

Aged owners of large houses showed an interest in selling their homes/villas for over €1-€2 mln and seeking a place in the centre.

A friend has gone down this route, sold/gifted her four-bedroom house at Strovolos and moved to a Nicosia central apartment (220 sq.m.).

She told us they are quite happy even though they miss their garden and fireplace, but can walk within 10 minutes from the centre and save around €4,000 p.m. in rental difference.

 

Antonis Loizou F.R.I.C.S. – Real Estate Valuer, Estate Agent & Property Consultant