CYPRUS – BOOMING PROPERTY HOTSPOT
Cyprus has the lowest level of income tax in Europe!
The emerging residential property market in Cyprus, located 35 miles south of Turkey on the eastern part of the Mediterranean Sea, has been something of a success over the past few years since becoming a member state of EU in May 2004.
The country’s economy is growing at a rapid pace, with inflation in Cyprus currently around 6.3% and interest rates just 4%, while Cypriot residents enjoy the lowest level of income tax in Europe.
Cyprus plans to give up its national currency and adopt the Euro on January 1 2008. At the same time, it will become a member of the Economic and Monetary Union (EMU). That means that interest rates in Cyprus should fall this year towards the Euro zone level, which should be good for the property market.
Still plenty of go in the Cypriot market
Residential property prices on the island have been rising steadily. Over the past three years since its introduction, the Cyprus Home Price Index has risen by 16.65%. Average prices in Cyprus did fall slightly towards the end of 2006, but still ended the year up 5.9%, bringing the average home price to around €158,000.
The Cypriot government is reportedly offering financial incentives to those wishing to purchase properties in Nicosia’s ‘old town’, which are in need of extensive renovation. In addition, rental income generated from these properties is tax-free, while transfer fees are waived. A three bedroom apartment in the centre of the city will cost around €240,000.
There are many international companies located in Nicosia. These employ expatriate workers who need long-term accommodation near their place of work. The majority of Cyprus’ Government institutions are also based in Nicosia as is the University of Cyprus and the larger educational institutions.
The Cypriot property market in 2007 is expected to continue to rise and is predicted that average property prices on the island will appreciated by 12.5% this year.
Wherever you eventually choose to buy a property, ensure that you plan carefully and use trustworthy professionals to undertake legal checks before parting with your money.
Extracted 31/01/2007 from an article on MSN Money
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