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Αντώνης Λοΐζου, FRICS

Antonis Loizou & Associates  Chartered Surveyors

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Mr Minister of the Economy

17 September 2017

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Finance Minister Harris Georgiades

#6 We have told the IMF that “Cyprus has as old car which is not working, yet we have placed a new paint on the car leaving the same engine”.

#8 We have explained to IMF that Limassol is “another country” and must not be compared with the real estate situation in Cyprus in general.

We had the opportunity to discuss with the I.M.F. consulting group which is examining the Cyprus economy and its recovery, the matter of real estate market.

We have laid down our own thoughts on the subject, which, in summary is as follows:

  1. The visa/passports is a case to consider and to bear in mind that notwithstanding that other countries have similar schemes, we seem to overdo it in the promotion. It is on the one hand, not as serious as it sounds, since only .3% they used this system in Cyprus, as opposed to the total of 99.7% of the total E.U. countries. But then, we are small as Cyprus and the only country that has “adopted” the Bail in with our E.U. partners abandoning us. Why not to target Cyprus again for this scheme as an example for others?

  2. The sales prices (Limassol) of €15.000/sq.m. for beach units and €10.000/sq.m. for near the beach is excessive by Cyprus standards, but it is not by comparison to other cities such as London, Paris, French/Italian seaside Riviera, Monaco etc whereas it is higher than that of our top spots competitors in Spain/Portugal.

  3. Sales of high end properties are fast and developers cannot develop fast enough, but there are many other developers waiting to climb on the golden band wagon and perhaps at some short time Cyprus should reexamine the relaxations given.

  4. The limitation of 3 years retention of ownership is not satisfactory since the existing, buyers will most likely sell their properties within a short period of time thereafter - Who will absorb the €2 mil./properties? - Not the locals - Examples of the Pieris Estate situation given.

  5. The time bomb of the “sick” system of the common expenses is an issue which has been ignored by the last 3 Governments entailing huge problems especially for the high end newcomers who pay an increasing attention to the good maintenance of buildings. Now that occupiers are not willing to pay €100 p.m., how will they pay the €1.000 p.m. common expenses for those high end properties?

  6. The red tape regarding the title issue is still with us. What is needed is a brand new procedure and not patching up of the existing system - We have told the IMF that “Cyprus has as old car which is not working, yet we have placed a new paint on the car leaving the same engine”.

  7. Banks should take special care on the funding of these projects that target the new high end properties.

  8. We have explained to IMF that Limassol is “another country” and must not be compared with the real estate situation in Cyprus in general.

  9. We pointed out the con job in the creation regarding the value of €300.000 (visas) or €500.000 (passports) since we have now the phenomenon of having a sales of a unit say for €400.000, but the applicant claiming that its value is €500.000. This will block the system and the word “value” should change to “cost”.

  10. The side effects on the Greek side in the event of a political solution, the return of Varoshia to its Grekk Cypriot owners etc were also discussed (including the return under the Turkish Cypriot administration).

  11. We have discussed in addition to the tax attraction that Cyprus offers, also its very low crime rate and the attraction by families.

  12. We have stated that Cyprus does not attract only Chinese and Russians but others from all over the world. The statistics that the Lands Office produces is basic, whereas there is a wealth of available information on which the Cyprus and business people can rely (details regarding nationalities of buyers, type of property and value bought, location by type etc etc). The data is there but it is an unexplored wealth.

  13. The legal system in a summary was discussed including the service of a law suit, delays in hearings and non-effective decisions.

  14. The cost of living was also discussed to a small extent and we reported that food cost is going down, as is the resale accommodation, cars, electricity etc (be it that expensive cars are on the up emanating from the foreign buyers primarily, as well as the doctors who do not issue receipts, auditors and some lawyers who deal with foreigners).

For these and other matters we had an exchange of views, but we do not know what the IMF impression of all these is.

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