Buying a property in Cyprus: basic documents
On 30 June, the REVERA Cyprus team held a webinar on buying property in Cyprus.
We have covered many important details of property transactions and related issues, and now we would like to share with you a series of posts on the key points of the property buying process in Cyprus.
The two documents we will focus on today are the reservation agreement and the property purchase agreement.
Reservation agreement
- The document that starts the purchase of a property in Cyprus and which is not a contract of sale and purchase;
- according to this document 1) the buyer pays a reservation fee (usually about 10 000 - 20 000 EUR) and acquires the right to conclude a sale and purchase agreement with the seller, and 2) the seller establishes a reservation period (usually 1 month), during which he has no right to sell, advertise the property to other persons;
- consequence of failure to conclude the contract of sale of the property before the expiry of the reservation period: as a rule, it is the failure to return the reservation fee (this amount may be refundable, but in practice we have not encountered such a situation);
- reservation fee can be included in the price of the property in the contract of sale of the property;
- extension of the reservation period: if for some reason the buyer cannot conclude the contract of sale within the reservation period, it is possible to extend the reservation period by signing an additional agreement to the reservation agreement with the seller.
Real estate sale and purchase agreement
This is the main document when buying a property in Cyprus by which the seller undertakes to sell and the buyer undertakes to purchase the property at the price and on the terms and conditions set out in the contract.
As a rule, the draft contract is prepared by the seller, accordingly, this contract is usually drafted exclusively in favour of the seller, after which the buyer and the seller negotiate the individual terms of the contract.
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