The Cypriot Parliament is reviewing proposed legislative reforms to tighten property acquisition rules for non-EU citizens.

These changes are designed to enhance transparency, prevent misuse of corporate structures, and ensure that the local real estate market remains accessible to Cypriot residents.

Background

Under the existing law, non-EU citizens face restrictions on the type and quantity of property they can acquire in Cyprus. However, many foreign buyers have been able to bypass these limitations by establishing Cypriot-registered companies, effectively allowing them to purchase multiple properties as domestic entities. This has increased property prices, making it more difficult for local buyers—especially young couples—to afford homes.

Key Proposed Changes

The proposed amendments aim to introduce stricter due diligence requirements. Lawyers, accountants, and real estate agents must conduct thorough background checks on foreign buyers to ensure compliance with anti-money laundering regulations. These measures are intended to:

• Enhance transparency in property transactions.
• Prevent foreign investors from using local corporate structures to circumvent property ownership restrictions.
• Maintain affordability for Cypriot citizens by regulating the foreign real estate market more effectively.

Impact on Foreign Investors

If enacted, the reforms may create additional compliance requirements for non-EU buyers looking to invest in Cypriot real estate. Prospective investors may need to undergo more extensive verification processes and provide additional documentation to demonstrate their eligibility.

Concerns from Lawmakers

According to Nikos Georgiou, an MP from Famagusta, approximately 40% of all sales contracts filed with the Land Registry in the first ten months of 2024 involved foreign buyers. He warned that the real percentage could be even higher due to Cypriot-registered companies with foreign shareholders.

Lawmakers argue that unchecked foreign investment drives up property prices in urban areas, making it increasingly difficult for Cypriot citizens to purchase homes. By implementing these reforms, the government hopes to balance the interests of residents while maintaining Cyprus as an attractive destination for responsible foreign investment.

Conclusion

Our team is ready to assist you in understanding and complying with the new legal requirements for property acquisition in Cyprus. Contact us today for expert legal guidance on your real estate transactions.