One wonders what will be in store for us regarding the future of Cyprus real estate.
There are two frontrunners in the second round (out of the original 14 candidates) hoping to win the coming presidential elections.
Based on what they have announced, Cypriot real estate will develop accordingly.
The two remaining candidates are close to each other regarding voting expectations.
Therefore, I thought of providing you with what I understand about their policy on real estate.
Of the three main runners, Averof Neofytou, president of the right-wing party (DISY), failed to make it through to the second round.
Had he made it, he promised to continue the prevailing government policy of the past ten years.
His view was to avoid increasing property taxes and keep a positive outlook for developments and developers.
He suggested subsidies to the needy renters and buyers to be addressed by the state, but there were no clear indications of how this would be applied.
Here are the views of the two remaining candidates:
Andreas Mavroyiannis
Supported primarily by the left-wing (communist party, be it that he is not a member of it).
He promises the taxation of real estate, especially regarding undeveloped land, so that more land for development is released in the market, thus reducing sale prices.
A most difficult goal to achieve with difficulties of implementing.
A similar proposal was submitted to the House in the past, but it was turned down.
This was our idea 15 years ago and repeated ever since, but it needs a lot of work to become effective.
Bearing in mind who the owners of the undeveloped land are, they are the main owners who will be affected, such as the Church, and the international funds, who have acquired land for resale.
The latter will make selling real estate more difficult (since this will most likely add the tax cost to the required sales price).
Nikos Christodoulides
I think it isn’t easy to understand his policy since he is not clear about it.
Supported by a mix of ideological parties, ranging from far right to socialist, centre parties and others, so for us, so it is difficult to understand his policy to satisfy the position of these parties, and as such, we have no clear understanding of what he is up to.
Parliament
Whoever wins will not have a majority in the House regarding deputies.
So, it is difficult to understand how the various policies will be approved.
During the existing presidency of Nicos Anastasiades, it took a lot of scheming and support by the DISY ruling party to get the proposed bills approved.
Still, bearing in mind the tax reliefs proposed in the past, it seems that the House will not approve increasing real estate taxes.
What is odd is that organised bodies, such as the business chamber (KEVE), the Employers’ Federation (OEB) and others, such as the Developers’ Association and the professional bodies, have not commented.
The results of the first round of the elections found Mavroyiannis and Christodoulides battling it out. They require support from DISY, wanting their votes on election day and the support of their deputies later in parliament to pass bills and budgets.
It is a puzzle how the two candidates will meet this challenge, but I expect they will come up with a sort of “mix grill” that will be more difficult to implement.
Looking at the Cyprus political system achieving an initial agreement is one thing, but implementing it is another ball game altogether.
This will come up after 3-6 months from the conclusion of the elections and what the results will be. We might require Houdini’s magic to help out.
By Antonis Loizou FRICS – Antonis Loizou & Associates EPE – Real Estate Valuers, Estate Agents & Property Consultants
