What is the latest news on Cypriot title deeds?
New legislation passed last year means that Cyprus has finally amended its archaic property legislation, improving life for home owners. Aiming to protect the ownership rights of the purchasers and to simplify and thus speed up the issuing of title deeds, the new legislation allows property owners to apply for all the necessary paperwork/permits etc themselves.
That said, we do advise owners that they will still require the assistance of an expert to guide them through the legal process and assist with the final transfer of the title deeds from the developer into their name.
Many of the hundreds of backlogged applications for title deeds [some owners have been waiting several years for them to be issued] relate to older properties and the deeds have not been granted because of issues/discrepancies within the planning/building permit; or because of loans on the land by the developer.
To simplify matters in explaining the new legislation I have divided the property owners into two categories: existing owners still waiting for their title deeds; and prospective buyers purchasing new-build or off-plan properties.
Existing owners waiting for deeds
Existing owners can now proceed with an application to get the title deeds for their property without the developer, as long as the contract of sale is lodged with the Land Registry Office for Specific Performance reasons. [Applying the legal process of Specific Performance - when a contract has been breached - means that you are forcing the relevant party to comply exactly with the terms of the contract.]
Three types of title deeds can then be issued: “clean” title deeds (with no infringements according to the plans); “incomplete” title deeds (property was not constructed 100% according to the planning permit); and “limited” title deeds (where there are serious irregularities according to the plans which must be rectified before the property can be sold).
Cases falling into this final category will be more complex. Once the application has been deposited any major issues not in accordance with the building permit must be corrected within a certain time limit, failure to do so will result in hefty fines. So this will help homeowners who are having problems with developers who are not fulfilling their legal obligations - the developer could now be fined up to €17,000 (£14,093).
With this category it is important for existing owners to find out the following information before proceeding: has the property and/or land got a charge/mortgage/ encumbrance on it? ; has it been built according to the Planning and Building permit? (if so, a copy of these will be required); has the final building certificate been issued? (if so a copy will be required); and what is the financial position of the developer required in order that they transfer the title deeds into the owner's name as the final stage?
This final point is important to note because even if the owner has used the changes in the legislation to obtain one of the three types of title deeds named above these will be issued in the name of the developer. So it is important to know if the developer is in a financial position to complete the last stage and transfer these to the owner - or whether the owner will have to take the developer to court to pursue the final transfer.
Prospective buyers purchasing new-build/off plan
Before signing the contract of sale on a prospective purchase, the potential buyer should ensure the following: that the planning and building permits are in place; the architectural plans of the property have been approved by the appropriate authority; and that the property is free from any mortgages and/or charges and if not then to obtain a bank waiver. On signing the Contract of Sale these should be attached and lodged at the Land Registry Office with their Specific Performance.
With these in place the owner can then simply apply through the Land Registry Office for their separate Title Deeds when the Final Building Certificate has been granted. On an existing property that already has its title deeds, these will be transferred immediately to the new owner on the purchase of the property. With new and off plan properties it is essential to do all the necessary homework on the property/plot - or to seek the services of someone who can do so on your behalf.
Again, we always advise you use a qualified independent professional in these matters.