Real Estate Investment and Permanent Residency in Cyprus — A Legal Overview

Ιn recent years, Cyprus has attracted a growing number of international investors seeking to benefit from the island’s strategic location, favorable tax regime, and high quality of life. Real estate investment remains one of the most appealing pathways, offering not only strong returns but also the opportunity to secure Permanent Residency through a well-regulated legal framework.

1.   Citizenship vs. Residency — Important Distinction

1.1. Cyprus’s Citizenship by Investment (CIP) program, which allowed direct naturalization through investment, was abolished in November 2020following EU scrutiny and corruption investigations.

1.2. No direct citizenship through investment currently exists.

1.3. The only valid route today is Permanent Residency (PR) under Regulation 6(2) of the Aliens and Immigration Regulations, which grants long-term residence rights, but not citizenship.

2.    Legal Basis

2.1. Permanent residency for third-country nationals (non-EU citizens) through investment is regulated under Regulation 6(2) of the Aliens and Immigration Regulations.

2.2. This fast-track program allows eligible applicants to obtain an Immigration Permit provided they meet specific investment, income, and character criteria.

2.3. The program is administered by the Cyprus Ministry of Interior via the Civil Registry and Migration Department.

3. Qualifying Investment Categories (Current Requirements)

3.1. Under the latest official guidelines, applicants may qualify for PR through one of the following investment options, provided the minimum investment amountis met:

• Minimum investment:€300,000 (plus VAT, where applicable).

•  Qualifying investments include :

1. Purchase of new residential property(first sale from a licensed developer).

2. Purchase of commercial real estate(offices, hotels, shops — resale property may be acceptable).

3. Investment in the share capital of a Cyprus-registered companythat employs at least five Cypriot or EU citizens.

4. Investment in units of Cypriot collective investment schemes(AIF, AIFLNP, RAIF).

3.2. For real estate purchases, newly built (first-sale) properties are generally required if the property is intended for residential use as part of the PR application.

4.   Additional Financial and Income Criteria

4.1. Beyond the investment amount, applicants must demonstrate stable annual income originating from outside Cyprus, typically at least €50,000per year.

4.2. Additional thresholds apply for dependents: €15,000 for a spouse and €10,000for each dependent child.

4.3. These financial criteria confirm economic self-sufficiency and prevent dependency on Cyprus’s welfare system.

5.   Legal Steps and Due Diligence in Real Estate Transactions

5.1. Legal Due Diligence (Pre-contract)

• An experienced Cypriot lawyer should:

1. Verify clean title deeds with the Department of Lands and Surveys (no mortgages, liens, or encumbrances).
2. Confirm the developer’s corporate, licensing, and tax standing.
3. Review planning and building permits, ensuring no unauthorized alterations exist.

5.2. Drafting and Registering the Sale Agreement

• The Sale and Purchase Agreement (SPA) must be stamped and lodged at the District Lands Office within the statutory timeframe to secure the buyer’s rights. • Include protective clauses: deposit refunds, delivery terms, title transfer conditions, and performance guarantees.

5.3. Tax and Fiscal Considerations

1. VAT: 5% (reduced) on the first 200 m² of a primary residence; otherwise 19%.
2. Transfer Fees: 0–8% depending on property value; waived if VAT applies.
3. Stamp Duty: up to €20,000 maximum per transaction.
4. Capital Gains Tax: 20% on profit from resale (with various exemptions).

5.4. Filing the Residency Application

• Submit the complete PR application (Reg. 6(2)) to the Ministry of Interiorόπως:

1. Executed Sale Agreement.
2. Proof of payment (minimum €300,000 transferred from abroad).
3. Bank statements proving lawful source of funds.
4. Clean criminal record, medical insurance, income proof, and other supporting documents.

5.5. Post-Approval Compliance

Holders must:

1. Maintain the qualifying investment.
2. Submit periodic updates (clean criminal record, proof of income).
3. Not be employed in Cyprus — except where acting as Directors in a company in which they have invested under this policy.
4. Visit Cyprus at least once every two years to preserve PR status.

6.  Key Legal Risks to Avoid

1. Buying without clear title: Always verify ownership with the Land Registry before payment.
2. Misunderstanding the “first-sale” requirement: Resale properties often don’t qualify for PR under the residential route.
3. Failure to prove legitimate fund origin: Anti-money-laundering (AML) checks are strict; full transparency is essential.
4. Misleading offers promising “citizenship”: The CIP is abolished — avoid schemes offering passports through real estate.

7.   Legal Best Practices and Recommendations

1. Engage an experienced Cypriot lawyer early — for due diligence, contract drafting, and regulatory compliance.
2. Verify current rules directly with the Civil Registry and Migration Department, as requirements may change.
3. Maintain complete documentation proving the foreign source of investment funds.
4. Stay compliant post-approval — maintain the investment and visit Cyprus periodically.
5. Avoid “shortcut” offers claiming to expedite citizenship or bypass official procedures — these can lead to serious legal exposure.

8. Looking to invest in Cyprus and secure your Permanent Residency?

Στη GIORGOULA STYLIANOU LLC, we help third-country investors turn property opportunities into long-term security and stability. Our dedicated legal team provides personalized guidance, manages every stage of the investment and residency process, and ensures full compliance with Cyprus law – so you can invest with confidence, clarity, and peace of mind.

Επικοινωνήστε μαζί μας σήμερα for immediate legal protection and support in maintenance matters. Schedule a meeting right away – even digitally.

Our team, GIORGOULA STYLIANOU LLC