Problems in the real estate market
Looking at many advertisements for the sale of real estate, one wonders if the managers, owners or investors involved with these properties have the ability to dispose of them in the correct way.
When it comes to property promotion I see quite strange things happening, which in many cases amount to misinformation to the point that they may also be criminal offenses.
Ads often include only brief descriptions, but if information is hidden, this can mislead the buyer into making the wrong decision. So if, for example, a building is advertised for sale that does not have building permits, and is therefore illegal, a buyer would be in for an unpleasant surprise.
Some cases I have encountered include the sale of an apartment in Limassol, where the unfortunate buyer, who was not allowed to visit it, found later that the previous owner had a €15,000 debt for utilities and other charges. With the purchase the buyer became the debtor himself.
In a case in Strovolos, an advertisement referred to the sale of a complex of 16 apartments and then the buyer discovered that eight of the apartments did not have a licence and one could not be secured.
Another case involved a plot of land on a road, as seen in the advertisement, but the road on that spot was not registered and therefore not a road.
Similarly, the existence of tenants is a serious disadvantage, especially when it comes to statutory tenants, which reduces the value of the property vertically.
Failure to report debts, taxes, utilities or litigation for a property, as far as I'm concerned, is a concealment of data and it is unacceptable not to mention such factors.
Not reporting whether or not VAT is payable, using the proviso ‘possibly subject to VAT' does not help buyers.
Encouraging a buyer to conduct their own research is certainly a must, but this does not help the property's disposal and creation of interest.
The end result is that people are suspicious of the real estate market.
Another issue is that big investment funds and other sellers, in most cases, are very disorganised, which does not help their sales.
Some of the funds have a plethora of properties of all kinds, which may amount to hundreds of properties in all areas of Cyprus. However, instead of these sellers helping the buyer find the right property for them, they do not have a clue how to handle the interested parties. These sellers should classify properties by location, type, price and so on to help facilitate sales.
If someone has a budget of at least €500,000, these sellers should have their properties sorted, so that the buyer can be served quickly and correctly.
It seems the desire and knowledge to serve buyers is lacking and this weakness on the part of sellers and agents is at the end of the day to their detriment, but also to that of debtors who may be credited with less than they may be able to secure.
Antonis Loizou & Associates EPE – Real Estate Appraisers & Development Project Managers, www.aloizou.com.cy, [email protected]
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