David Lidington spent two days on the island and among the issues he brought up with Foreign Minister Ioannis Kasoulides was the fact that so many British expats still don’t officially own their homes after decades of problems.
The situation goes back years when unscrupulous builders took out mortgages on properties that they couldn’t pay back and therefore the owners could not get title deeds for their homes.
The Cypriot government has been trying for years to sort out the backlog but thousands are still without the documents that prove their own their properties.
Lidington welcomed what he described as ‘constructive work’ done by the Cypriot government. ‘I know that this is not something that has only affected British people, but a very large number of citizens here in Cyprus have been beset by the same legal problems over housing arrangements that in some way have gone wrong,’ he explained.
‘And it’s in both our interests to hope for a way forward for those families that go through a great deal of anguish and uncertainty,’ he added.
'This is an important issue for the Cypriot government that we are determined to effectively address,’ said Kasoulides.
Meanwhile a new law aimed at regularising the rental market in Cyprus has been abandoned. It was drawn up to lower residential rents to a fixed price for a year. But President Nikos Anastasiades refused to sign it off, claiming that it was against article 26 of the Constitution which says that everyone has the right to enter into a contract freely. It was argued that fixing rents meant that landlords and tenants could not freely enter into a contract.
Following the construction boom in Cyprus property prices have plummeted since the global economic downturn and thousands of homes that were built still remain unsold.
A large number of locals have defaulted on their mortgage payments due to the financial and banking problems which hit the economy leading to a European Union bail out. Banks took over ownership of many properties but have been unable to sell them even at discounts of 50%.
In the second quarter of 2013 prices of apartments and houses fell by an average of 4.2% and 5% respectively, according to the Cyprus Property Index from the Royal Institution of Chartered Surveyors.
Apartment prices fell the most in Paralimni/Famagusta with a decline of 6.7%, while they fell 5.2% in Nicosia, 3.9% in Limassol, 3.3% in Paphos and 2.4% in Larnaca. House prices fell 9.2% in , by 6.6% in Paralimni/Famagusta, by 4.1% in Nicosia, by 3% in Paphos and by 2.6% in Limassol.
