Properties in Cyprus – Residential rental versus vacation rental?
Have you recently decided to rent out your property in Cyprus and are trying to decide whether to rent it as a residential or holiday rental? If so, you may find the following of interest to you.
First of all, the law in Cyprus is definitely on the side of the tenant rather than the landlord and renting a property in Cyprus is somewhat different than renting a property in the UK.
Deposits
A deposit is usually required for 1 month’s rent, although you can sometimes request 2 months’ rent.
length of tenure
A normal term for a lease starts at 12 months which, on the plus side, gives you an expected rental income each month. However, if you intend to use your property for yourself or take it back at the end of the 12-month lease, then you really need to keep reading because it’s not that simple.
Is your property subject to the Rent Control Act of 1983?
If your property was completed before December 29, 1995 and is located within towns, suburbs and rural centers, the legal definition is “Controlled Areas”, then it would fall under the Rent Control Act of 1983 and any updated amendments, in place of the “Free Market”. . That is unless you are a foreigner.
Foreigners (unless the non-citizen spouse of a citizen of the Republic) are not covered by the provision of the law and therefore cannot benefit from the protection of the Rent Control Law.
So what rights do you have as a landlord in Cyprus?
It used to be that if you were a foreigner you couldn’t rent property in Cyprus, but after the EU negotiations and subsequent admission to the European Union this changed; however, to my knowledge, if you own a property outside of the EU, you still may not rent the property.
The law really seems to be stacked on the side of your tenure instead of you having a owner.
Can I evict a tenant?
It’s pretty hard to avoid a tenant. The Rent Control Law incorporated the ‘Statutory Tenant’ who is the person who at the end of the first lease under the limits of the “Rent Control Law” remains in possession of the property. You can only evict a legal tenant for the following three reasons.
1. If the tenant does not pay the rent
2. If the Lessor needs the return of the property for himself or members of his own family or dependent parents
3. If the lessor intends to tear down and rebuild the property or to carry out those substantial reforms and alterations or reconstructions that imply the recovery of the property to carry out the work if it is absolutely necessary.
And even then, the Rent Control Court can order the Landlord to award the tenant (in the form of damages) the right to new tenancy in the newly rebuilt property. And the landlord may also have to pay damages for 9 to 18 months’ worth of rent and/or damages for loss of any goodwill if the Court decides to award this as well.
For properties built after 1995 the terms of the contract apply.
What happens if your tenant doesn’t pay rent? How long is it likely to take to evict him?
Until the end of the process service, the duration is 60 days
The duration of the trial 120 days
The duration of the application 180 days
Total number of days to evict tenant 360 days
This seems like a long time to house a tenant who doesn’t pay you any rent, and if you have a mortgage, it could get you into big trouble.
Can I increase the rent of my property?
After the first 12-month lease is up, you can increase your rent by up to 14 percent, but only if it has been at least 2 years since your last rent increase.
long term rental
You may prefer to rent your property long-term, especially if you know you won’t want to use it much for yourself and need monthly rent to help cover your mortgage costs.
Or maybe you just bought it as an investment property with no intention of using it yourself, in which case a long-term rental may be ideal.
However, if you wish to use the property yourself now or in the future, it is worth bearing in mind, especially with the ‘legal tenant’ rule that long-term rental may not be suitable.
Vacation Rental
Perhaps you’d like to research the vacation rental market, although of course it’s more likely to be seasonal and you won’t get a guaranteed monthly amount. You may also find that your property is occasionally left vacant, so you’ll need to check that your property insurance covers periods of non-occupancy. On the plus side, any empty period can give you an opportunity to take some time off and visit your property for yourself and your family.