Law Approved by Cyprus Parliament to Safeguard Real Estate Purchasers Facing Predicament
In a significant move to restore confidence and legal certainty in the real estate market, the Cyprus Parliament has passed a new law aimed at protecting "trapped property buyers." The legislation, introduced by the Parliamentary Committee on Legal Affairs, Justice, and Public Order, addresses a long-standing issue that has left thousands of individuals without title deeds for properties they have fully paid for.
The new law applies to individuals who have been unable to become legal owners due to encumbrances or prohibitions affecting the seller. According to estimates, the law will provide a solution for approximately 9,497 trapped buyers whose applications to secure title deeds were stalled following a critical court decision in June 2024.
The law establishes a new mechanism to transfer property titles to trapped buyers in compliance with constitutional principles and the Supreme Court's findings. It restores legal protection to buyers who paid in full but were prevented from becoming registered owners due to encumbrances or other legal burdens on the seller.
The legislation includes clear provisions mandating local district offices to issue title deeds under specified conditions and incorporates safeguards to protect buyers' rights. Politically, the law was passed unanimously, signaling strong support to correct what was described as a "blatant injustice" against these buyers.
One of the key features of the law is its approach to abusive refusals of consent by lenders or other parties. The law addresses this issue by cutting through bureaucratic and legal obstacles that had previously allowed banks or developers to delay or block title deed issuance unfairly. In cases where lenders or other parties refuse to grant consent "abusively and without justification," a court order can be substituted and submitted to the Director of the Department of Lands and Surveys.
Any related pending procedures (under Bankruptcy, Companies, or other relevant laws) are suspended until the court order is issued, given that the application is filed with the Land Registry. The possibility of proving payment through a clearance certificate from a licensed credit institution or credit facility administrator is explicitly provided for.
The Supreme Court is empowered to issue procedural rules for the effective implementation of the new law. The need to continue efforts to resolve the long-standing issue of trapped buyers in Cyprus real estate was emphasized.
The social dimension of the new legislation was highlighted during the debate in the Plenary. The need for this new law arose after a Supreme Court ruling in June 2024 declared certain provisions of the existing law unconstitutional, leaving trapped buyers who purchased properties before the relevant law took effect without protection.
This reform is part of a wider effort to restore buyer confidence and legal certainty in the Cyprus real estate market after years of contentious issues and legal challenges. The new law creates a streamlined, legally backed pathway for trapped buyers to finally obtain title deeds on paid-for properties by removing unjustified encumbrances and forcing responsible parties, including lenders, to cooperate with the title transfer process.
- The new law, passed in Cyprus Parliament, targets individuals who have been unable to become legal owners of real estate due to encumbrances or prohibitions affecting the seller, providing a solution for approximately 9,497 trapped buyers.
- The legislation includes provisions that mandate local district offices to issue title deeds under specified conditions, protecting buyers' rights and eliminating abusive refusals of consent by lenders or other parties by allowing for a court order to be substituted.
- This reform is a step towards restoring Confidence and legal certainty in the Cyprus real estate market, as it creates a streamlined, legally backed pathway for trapped buyers to finally obtain title deeds on their properties, making it more attractive for EU investors in Cyprus property and finance sector.
