Low Cost Opportunities in Cyprus Property

Following the adoption of the Euro by the Republic of Cyprus earlier this year, the relative cost of Cyprus property has increased with a corresponding drop in foreign investment interest. However, re-introduction of fiscal policies such as tax breaks and incentives for property owners domiciled in Cyprus, along with changes in domestic politics means that investment interest is surging, especially in the north of the country.

The introduction of low cost air carriers such as Easyjet and Ryan Air are expected to drive visitor numbers over the next few years, which will in turn increase rental values and demand for Cyprus property. Easyjet have already established a route servicing Paphos, whilst Ryan Air are still negotiating with the Cyprus authorities. In any event, given the growth of low cost flight carriers, affordable flights can be expected to increase.

Tourism is the primary industry of Cyprus, with year long demand for rental of Cyprus property, and for good reason. Cyprus boasts a sunny climate all year round, with long hot summers that average 27 degrees centigrade in the north, and 30 degrees in the south. Winters are mild, and the temperature will rarely drop below 12 degrees centigrade, making it an ideal tourist destination at any time of year.

Rainfall occurs primarily in winter, with the result that the island is green and verdant for most of the year, and host to a wide range of subtropical plants, including orchids, for which the island of Cyprus is famous. Cyprus is also steeped in history, with ruins and sites of historic interest within easy reach of any potential Cyprus property investment.

Cyprus also boasts many miles of beautiful and unspoiled sandy beaches, with numerous deserted peninsulas and undeveloped areas. For the Mediterranean, this is a fairly unique feature and gives the holiday maker who is seeking peace and quiet a wide and varied range of potential destinations.

These features of the island of Cyprus are relatively unlikely to change in the near future, and all of them represent good reasons for potential buyers to invest in a Cyprus property. However, there are a number of political issues that a potential purchaser of a Cyprus property must take into consideration when making an investment decision.

Following the invasion of Northern Cyprus by Turkey in 1974, the island has remained divided into two separate republics. However, only the southern Republic of Cyprus has been recognised by international bodies such as the European Union and the United Nations.

Following the introduction of an elected government, the Southern Republic of Cyprus was formally accepted into the European Union in 2003 and the Euro was formally adopted as the local currency in February 2008. This has provided political and economical stability to the South of the island, which has prospered in the last five years with major growth in the value of Cyprus property.

Whilst a 'North - South' divide remains in Cyprus property prices, Northern Cyprus properties have received a boost after the disestablishment of border crossings in 2005. Furthermore, recent improvements in the political situation have increased the likelihood of the development of the long term resolution of the dispute that has divided Cyprus into its northern and southern regions. This means that there is a real prospect of a major elevation in Cyprus property prices located in the North of the country in the relatively near future.

As with all investment decisions, it is wise for any potential investor in Cyprus property to take expert advice and to ensure that full advantage is taken of any local financial and investment incentives before committing their money overseas.