JUNE 2013
The island of Cyprus has been a haven for some and a world of trouble for others
2012
June 25: Cyprus requests fi nancial assistance from the Eurozone October 8: The EU asks the island to accept the proposed plan from the International Monetary Fund and the European Central Bank
2013
January 11: German Chancellor Angela Merkel urges Cyprus to follow economic reforms February 24: Right-wing Nicos
It took a long time to finalise the bailout deal
Anatasiades is elected president. He pledges to prioritise fi xing the economy March 13: Moody’s and Fitch downgrade Cyprus’s rating, to Baa3 and BBB- respectively. (BBB- is the lowest possible rating for a borrower). March 16: The International Monetary Fund and fi nance ministers from the Eurozone agree on a EUR 10 billion bailout for the island (far less than the EUR 17 billion originally requested by
Nicosia). The proposed deal would mean that any deposits over EUR 100,000 would take a 9.9% hit – with a levy of 6.75% for deposits under that threshold March 17: An emergency debate on the bailout is postponed. The president declares an extra bank holiday after a three-day holiday weekend April 28: the Bank of Cyprus enforces a conversion to shares in the lender of 37.5% of any savings over EUR 100,000. The remaining 62.5% of uninsured money will be dealt with diff erently, with 40% continuing to accrue interest (which will only be paid back if the bank does well) and the last 22.5% that will stop attracting interest entirely.
EFFECTS ON REAL ESTATE The latest fi gures from the Department of Lands and Surveys have not been hugely cheering. In April 2013, 285 contracts of sale were deposited nationwide, down 38% on April 2012’s 461 sales contracts. This was the lowest monthly fi gure on record. Of the contracts in April 2013, 59% were for domestic buyers and 41% for overseas buyers. On the other hand, an encouraging piece of news hit OPP’s desk just a few days before
this edition went to print – a proposed EUR 1.5 billion injection of investment into the island from Hong Kong-based conglomerate ‘China Glory National Investment’. The company are already investing EUR 290 million in Venus Rock Golf Resort near Aphrodite Hills, and told reporters in Cyprus that they are considering investment in more projects, though they remained vague about the details.
“The whole investment will reach about one-and-a-half billion euros and instantly have multiple benefi ts, both with regard to employment on completion of the project and in direct revenue in terms of taxes, direct and indirect,” Theodoros Aristodemou of Aristo Developers said. “At this stage it may be around EUR 40 million but by project completion it may reach EUR 400 million.”
THE AGENT’S VIEW
OPP talked to Chris Hadjikyriacou, sales director at BuySell Cyprus (
www.buysellcyprus.com), who was helpful and startlingly optimistic.
So, what’s been happening to real estate?
“A lot of people have realized that banks are dangerous – money is
07
www.opp-connect.com
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