It’s not hard to see why Cyprus remains one of Europe’s top tourist destinations with more than 1.6 million people visiting the eastern Mediterranean island between January and August 2008 according to the Passenger Survey. It is loved not only by thousands of tourists, but also by second home owners and also by expats who choose Cyprus due to its inimitable climate, incredibly relaxed pace of life, standard of living and ultimately the beauty of Cyprus. . You can add to these positive factors stacking in favor of Cyprus the fact that it is a low tax island, it is a member of the EU, it has a vibrant business environment and its banks are in a much better position than those in much of the the world with national banks that supposedly have 6.5 billion euros more in deposits than in loans, due to investments in national banks by foreign companies.
Due to the health of the Cyprus economy and international business environment and the island’s undeniable appeal as a tourist destination, Cyprus is also equally popular with buy-to-let property investors from around the world. Banks in Cyprus have made loans to buy second homes and investment properties possible, and the short-term and long-term rental markets are healthy, making the island an enduring choice among domestic and international investors who recognize that one can potentially benefit from the likes. from professionals in the main cities to vacationers in the main resorts.
If you are actively contemplating buying property in Cyprus to rent, Martin Pearce of Aristo Developers, an expert in Cyprus real estate, has the following advice for prospective buyers:-
- Determine the demand for the type of property chosen in particular, that is, if you are thinking of buying a beachfront apartment, think about the tourist demand for that property. If you are thinking about attracting golfers all year round, what are the best golf properties, or if you want long-term rental contracts, what will the local people or entrepreneurs who will make up your potential customer base want and buy a property accordingly?
- With your rental tenant in mind, examine your location carefully, your potential tenant should drive your choice of location. For professionals, Nicosia and Limassol are good places, for families on vacation, how about a beachfront villa or apartment?
- Be sure to choose the correct type of property. Think about the pros and cons of apartments, townhouses and villas, and remember that different types of properties attract different tenants, so what’s best for them, for your chosen location and for you?
- Consider the accessibility of the property you are buying. If you are shopping for tourists, is it within reach of Paphos or Larnaca airport? If you’re shopping for a professional, is it easy to get to the central business district? Is there good road accessibility and is the property within reach of the required and desired services?
- Be realistic about your potential rental income. Think carefully and find out how much you can expect the property to rent during peak hours if it’s a tourist property, and think about whether you’ll be able to cover your rebates and costs even if you don’t have tenants for an hour period. By being realistic from the beginning, you will avoid potential problems in the future.
- When furnishing a rental property for short-term renters, you need to think about comfort versus wear and tear. What is the tenant market you are targeting? If you want youngsters or families, then the furniture may take more of a hit than if you’re renting long-term from city professionals. Whatever furniture you use to furnish the property, be sure to write a full itinerary before you rent the property each time.
- Consider using a management agency to look after your property in Cyprus if you won’t be living near it. This will cost you money, but it will potentially save you time and even more money in the long run.
- Remember to get the right type of insurance coverage and always take a deposit from your renters.
- Also remember your tax responsibility: while Cyprus is a tax competitive nation, if you earn income from your investment property, you will need to report it and possibly pay some tax.
- Finally, think about advertising the property, ie how are you going to market your property to potential tenants? You have local options, international options and of course online options. Think about making the most of all this: the more people hear about your property, the more potential tenants you will have.
