Cyprus is rethinking how it handles property purchases by non-EU nationals, as concerns grow over housing affordability and the rising influence of foreign investors on the local real estate market.
EU vs. Non-EU: The Legal Divide
While EU citizens can buy as many properties as they like in Cyprus, non-EU nationals still face legal limitations under the long-standing Acquisition of Immovable Property (Aliens) Law, Chapter 109. These include restrictions on land size and the need for government approval before purchasing.
Although these laws date back decades, many non-EU buyers have found a workaround: purchasing through Cypriot-registered companies, which are treated as local entities under the law. This tactic effectively sidesteps the restrictions — and it’s become quite common.
The Market Impact: Rising Prices & Local Concerns
This loophole hasn’t gone unnoticed. As more wealthy foreigners invest in multiple properties, homeownership is slipping further out of reach for everyday Cypriots, especially young families. The issue was recently discussed in the House Interior Committee, which is reviewing a bill introduced by MP Nikos Georgiou aimed at updating these laws.
Between January and October 2024, nearly 40% of property transactions recorded at the Land Registry involved foreign buyers. And that number could be even higher, since foreign-owned companies count as local in the official stats.
Proposed Changes at a Glance
The legislative update aims to:
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Increase due diligence by lawyers, accountants, and agents, in line with anti-money laundering efforts.
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Close loopholes allowing misuse of company structures to bypass restrictions.
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Tighten enforcement to protect local housing access.
Legal Loopholes Under Scrutiny
Recent cases have spotlighted the system’s vulnerabilities. One example: the sons of Simon Mistriel Aykut, wanted for property usurpation in occupied Cyprus, managed to acquire €1.2 million worth of assets in Larnaca and Nicosia through a Cypriot company before the authorities intervened and froze the assets.
Global Perspective
Cyprus isn’t the only country grappling with these issues. Other EU nations are already taking action:
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Finland is reviewing property laws due to national security concerns.
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Greece requires permits for buying near borders.
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The UK enforces strict financial regulations on foreign real estate investors.
The Cypriot government now faces the challenge of balancing foreign investment with fair housing access — and all eyes are on how the final bill will shape up.
Source: www.news.cyprus-property-buyers.com
