Developers Suggestions

The ex-President of the Cyprus Association of Business Building and Land Development (or just the Cyprus Developers Association), Mr. Lakis Tofarides have made specific suggestions to revive the Cyprus Property market and the wider economic development activity. 'The real estate industry will continue to play, as in the past, a decisive role in social and economic advancement of our country,' he said, adding that if the State take appropriate measures as soon as possible, the economy will return to a dynamic growth trend. He added that the economy needs targeted movements and not quick solutions that will solve problems temporarily.

Chronic structural and functional problems

'The Cypriot economy as a whole, but primarily for our construction industry, is now paying for the mistakes of the past and the false estimates of “dystocia” and procrastination in taking drastic measures.' The tragic situation in the housing market is reflected in the information provided from time to time and is published by the Department of Lands and Surveys Department and the Statistical Office of the Republic, ' Mr. Tofarides said that the facts point to the dramatic reduction in sales and purchases, the decline in external demand for real estate, the fall in construction activity and the rapid increase in unemployment in the sector compared with previous years. He noted that banks finance mostly businesses which phase difficulties but the liquidity in the housing market is negligible, while construction companies are closing down one after the other.

He also referred to the Report of the World Bank ?Doing Business Report 2011?, prepared by the Cyprus Investment Promotion Agency, which confirms the views and concerns of the Association for the problems of bureaucracy and delays faced by the licensing system, securitization and transfer of property in our country. Cyprus, according to ?Doing Business Report?, which assesses the degree of convenience for the start of work and running a business in each country occupies in the overall ranking the 37th in a total of 183 countries, in recording property occupies the 66th position.

Incentives for market revival

'The two laws recently passed by the House of Representatives for a reduced VAT rate on the market for permanent residence and elimination of transfer fees subject to VAT, they can contribute positively to the recovery of the property market. These two important incentives, coupled with a decline in prices was recorded as a result of reduced demand for property and general economic slowdown, creating an environment that consumers and investors should use, 'argued Mr. Tofarides. At the same time, welcomed the promotion of Urban Amnesty, saying that was the recommendation of the Association, which was three years ago.

Even Mr. Tofarides said that the promoters and if the incentives were adopted, 'the land development sector, we need stronger treatments if you want, state and private sector, to see him playing the role it had a very positive development of our economy by 2008 and become again the main donor of direct public revenue. '

Six proposals to revive the property market

1. Tax amnesty for repatriated capital from investment, provided that they invested in real estate market. Discharge also the 'Occupying' and statements regarding all property purchases real estate in Cyprus Land Registry filed for two years

2. Grant tax deduction / credit of Income Tax (Cypriot individuals or companies) and / or the Capital Gains Tax (companies or foreign) of 20% of the investment each buyer of residential units, offices, shops etc

3. Accelerated depreciation of investments in the construction industry for at least five years as a key incentive for new capital investments in real property, which due to market uncertainty and high funding costs have pagopoiithei

4. Shifting Capital Gains Tax arising from the sale of real property, provided that within six months the owner will make a purchase of another property (as when an exchange of real property)

5. Providing specialized incentives for large development projects (eg marinas increasing the duration of the timeshare from 90 to 125 years of golf and increase the rate of construction). For routine work up to 20% increase in the rate effective for building projects started in 2012.

6. Reassessment of real property taxation system. Recommends that reshaped the whole system by integrating all the taxes and the tax division in the acquisition and occupation tax so that both the citizen to know exactly what you would pay from the beginning and the other state to collect the revenue attributable to a simplified basis and no additional administrative costs

Promoting institution One-Stop-Shop

In connection with the creation of the Unified Development Authority recommends that the Association, Mr. Tofarides said that along with promoting of a (one-stop-shop) will allow completion of all tasks and procedures required for issuing such licenses, eliminating thus the current bureaucracy.

The crisis as an opportunity to start new era

The president of the Association in his speech said that it is time to rid the state of wariness and distrust with which addresses business and other private sector and work in real estate development issues, stressing that the Association faces crisis as an opportunity. 'A chance to do what we did when we had. As an opportunity to correct the incongruities around the system and our state machine. Now, as a country and as an economy we are faced with unique opportunities and significant challenges. Now, with the discovery of natural gas generated prospects and upgrading the role of our geostrategic position. We are optimistic. These new data may soon create a new economic miracle. '