Property Investment in North Cyprus
The rapid development of infrastructure and the presence of foreign investors, along with modern and luxurious constructions nestled in nature, have transformed this small and beautiful country into one of the best coastal areas for living and investing in the world. As seen in the slides, the reputable economic magazine Forbes has recognized the Northern Cyprus coastline as one of the best coastal areas in the world for investment, both in 2021 and 2024.
Although the official currency unit in Northern Cyprus is the Turkish Lira, capital goods such as real estate and automobiles are traded in this country with the British Pound. Considering that the British Pound is one of the most stable currencies globally, the security coefficient of real estate investment in Northern Cyprus is very high. On the other hand, property prices, ranging from luxury villas and apartments in tourist coastal areas to regular apartments in major cities, are much lower than the average prices in Europe, North America, and even some countries in the region. Thus, you can become the owner of a new, modern, and luxurious villa or apartment on the Mediterranean coast with a minimum cost of around a thousand British pounds per square meter, with flexible installment conditions, and receive not only a secure and profitable investment but also family residency
Furthermore, Northern Cyprus is among the few immigrant-friendly countries that do not require presence conditions for residency renewal. You only need to visit the country once a year to renew your residency and can rent out your property during the year. It's worth mentioning that citizens of most countries do not need a visa to enter Northern Cyprus, and a visa is issued upon arrival at the airport. Therefore, even if you currently have no intention of living in Cyprus, you won't need to renew your annual residency. Another attractive aspect of investing in Northern Cyprus is the flexible payment methods offered by most large developers. You can pre-purchase your desired property with a 30% down payment and pay the remaining amount in installments without interest over 3 to 6 years. Additionally, you can formalize your residency and that of your family upon signing the official registration contract.
Factors to Consider for Profitable Real Estate Investment:
1. Capital Security: The first consideration is the security of investment capital. In Northern Cyprus, you can even register pre-purchased properties with the Land Registry Office (Tapu) to ensure your ownership rights. It is necessary to mention that legally, you must register the purchased property in the land registry (Tapu); however, sometimes individuals keep their property on a company contract to reduce costs and avoid paying registration fees, which we do not recommend.
2. Property Location: Location plays a crucial role in determining the intrinsic value of a property and its investment value. Given the tourism boom in Northern Cyprus and the immigrants seeking to buy property and obtain residency, it's clear that residential complexes, whether villas or apartments, in tourist coastal areas with amenities such as green spaces, swimming pools, cafes, and sports clubs, have a higher investment value. Therefore, as an investor, you should consider this factor when purchasing.
3. Property Valuation: One of the most important considerations when buying property is its valuation. To do this, compare the desired property with similar properties in the market and calculate additional costs such as depreciation and potential rental income.
4. Investment Timeframe: Real estate investment, compared to gold, currency, and even the stock market, has a lower liquidity potential. Therefore, to achieve satisfactory returns, you must be patient and wait for suitable opportunities. If you enter this market with a suitable budget, you can sell your property at a reasonable price during times of high demand. However, in uncertain market conditions due to global and regional geopolitical factors, market corrections, and unforeseen circumstances, you may be forced to sell your property at a lower price or even at a loss. It's better to be patient and wait for market upturns. We recommend not chasing high and immediate returns; however, sometimes, with adequate liquidity, there are excellent opportunities to buy properties below market value and achieve good short-term profits.
Cash Flow from Real Estate Investment: Before investing in real estate, you need to ensure several things: Rental Income: Firstly, determine the rental income of the purchased property. For example, the average price of a two-bedroom newly-built unit in tourist coastal areas of Northern Cyprus is currently around £160,000, with an average monthly rent of £750 on an annual lease. However, you can rent out your property for up to £1,500 per month during the long tourist seasons in Northern Cyprus, which is much more profitable. In Northern Cyprus, usually, one year's rent is collected in advance, and an equivalent of one month's rent is retained as a deposit with the owner, and the tenant is obliged to return the property and its belongings intact upon delivery. Profit from Property Price Appreciation: By analyzing market trends in previous years, you can estimate the profit from selling in the medium and long term. Remember to include expenses such as taxes, fees, furnishing, and equipping the unit in your calculations.
