written by, Sevya Türmen / Hunter Ruzicka, Acorn Estate and Letting Agents
 

Letting (Renting Out) Your Property in Cyprus

Whether you are a professional landlord or somebody who lets their home when they are not using it, there is quite a lot to learn about letting property in Cyprus.

Many people want to let (rent out) their property in Cyprus. For some, it is how they earn their living. For others, it is to generate some income from their property whilst they are away – whether working abroad or on holiday. Other people have a house or apartment that they have been unable to sell during the last few years when the property market in Cyprus has been difficult and sluggish.

This guide is aimed at all of these people. We cover long-term lets, short-term lets, and the letting of holiday homes.

The first question is whether you want to – or are able to do – any part of the work yourself. If you live near the property you want to rent out and have time on your hands you might want to do this to save a bit of money.

 

An estate agent can do all the work involved in finding a tenant, including showing the property. They will, typically, charge a fee of one month’s rent. They may also charge the tenant one month’s rent for introducing them to the property. Some agents merely find a tenant. Others (the majority) offer a fuller package including producing a contract and inventory and taking up references from the tenant.

The second question is whether you speak fluent Turkish. If not, you will need to use an agency where somebody (and preferably several people) speak your language and the language of the people you think are most likely to want to rent the property. There are some places particularly favored by Russians or Swedes, so it makes sense to be ready for them!

In most cases, our experience is that using the services of a good local estate agent – who advertises online – is the better option for most foreigners who are letting property in Cyprus. Not only will they take a lot of work off you but they will make sure that everything is done properly in accordance with Cyprus law.

Property Descriptions

A good and accurate description of your property, a map showing its location, and lots of nice photographs are vital if you want to let your property quickly. Check some of the online sites to see what professional agents are saying about their properties.

The description should be available, in English and in any other language commonly used in the area (e.g. Russian).

Properties are described by a reference to their size: A house of 70 m2 gross area and 60 m2 of net area.

The construction is the total size of the construction within the perimeter of the house. It includes the area of the walls and any lift shafts, ventilation ducts, services spaces, etc. It will also often include the area of any terraces.

Preparing for the tenant’s inspection of the property

There are some things it is always worth checking before you agree to show a tenant around your property:

 

• Working heating / air conditioning
• Working plumbing
• Working hot water
• Working lights
• Working cooker
• Condition and comfort of beds
• Condition of carpets
• General condition
• Are all the keys present and do they work

In addition, you will need to prepare a detailed inventory of the contents of the property and a detailed statement as to the condition of the building.  Use photographs as part of both.
You will need to decide:

 

• How long do you want to make the initial duration of the tenancy (see below)
• Will it be furnished or unfurnished?
• If the tenant wants to use their own furniture, will you permit them to put it into storage (or do it yourself)?  On what terms?
• Who will be liable for communal expenses
• Who is going to be responsible for property tax

Agreeing on the terms of the letting & subletting

These will be agreed upon between the tenant and the letting agent if you are using one. They will agree on the rent, the amount of any deposit, the amount of notice you will each have to give and receive, and the proposed initial length of the contract.

The legal formalities: There should be a written contract, signed by you and the tenant. It should be in English/Turkish. Make sure you also get a signed inventory. The tenant will have to pay a deposit. This is, usually, the equivalent of two months’ rent and it is paid at the same time as the first month’s ‘normal’ rent.

It should be paid into an escrow account and held there until the tenant leave. Different regions of Cyprus have slightly different practices as to this. The agent will know what to do. It is in your interests that all rent payments should be by bank transfer and not in cash. That way you can prove they have been made.

It is a good idea to get your lawyer or a fully qualified estate agent to prepare the rental agreement. You may well use it several times at it is well worth getting it right in order to protect your position. Rental of a permanent home. Any agreements made contrary to the law will be null and void.

Having a well-written sublease agreement is a great way to protect yourself from problems related to subletting an apartment. The sublease agreement should clearly outline the responsibility of each party involved, thus ensuring that rent is paid without fail. That is the answer to the question of how to sublet an apartment.

There is no obligation to register your property as a holiday home with the regional tourist registry.

Definition of a holiday rental

The decree is rather vague on this point but:

 

• The property must be built on land classified as ‘residential’ (in other words, properties on rural land are excluded)
• The property must be rented out to tourists regularly on a short-term basis (days, or weeks).
• There must be a system for booking the property.
• The property will be regarded to be rented out as a holiday home if the landlord advertises it using companies who intermediate between landlord and tenant in exchange for a commission or other payment: travel agencies, real estate agencies, holiday rental websites such as Airbnb or etc.

Ongoing Property Management

As well as finding a tenant, as a landlord you will have a number of things to do on an ongoing basis. These will include;

 

• Collecting the rent, paying your bills,
• Filing your taxes,
• Arranging repairs
• Cleaning (and making good) the property at the end of the tenancy.

You can either attend to these things yourself or you can engage a property management company. Many estate agents offer this service but there are also dedicated property management companies. Choose a good one by seeking recommendations and checking the company carefully.

For normal tenancies, lasting from several months to a year or two, you can expect to pay 7-15% of your rental income for a complete service. For short-term holidays lets it can be a lot more because the process of meeting and greeting the tenants and cleaning is so time-consuming. As is so often the case, the cheapest is not usually the best.

Good property management companies will usually save you more than they cost. There are lots of people looking for a rental property in Cyprus. Student and Tourist numbers are up and the number of ex-pats living in Cyprus is either stable or rising.

Just make sure that you prepare your proposed rental property thoroughly and that it complies with the relevant law – and always check your tenants by taking references.

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