The bailout agreed for Cyprus does mean that the people will pay higher annual real estate taxes.
Now as part of the bailout terms 60,000 title deeds must be issued in the next 18 months. Staff at the Land Registry have been issuing around a 1,000 title deeds a month but they are being told to be faster from now on. They will need to produce at least 3,000 a month to meet the deadline. A Land Registry spokesman said that staff have volunteered to work on Saturdays to work towards meeting the target. If they fail then the bailout deal could be in jeopardy.
A Land Registry staff is also having to re-evaluate properties so that a new Immovable Property Tax can be properly applied. The annual property tax will still be based on the value of a property on the 01 January 1980 but many owners never paid any as their property was not registered and that is now having to be rectified.
The Land Registry said that these tasks are taking priority and any other work, such as the sale of property, is likely to be slow. It means that anyone buying a property could face a heavy wait for the land registry documents.
Members of Cyprus Parliament have voted through the new tax which will make every estate owner pay a minimum of €75 with increments rising according to the value of the property.
Another problem is building permits. It is estimated that in some places such as Limassol, Nicosia, and Larnaca houses worth millions of euros have been built without building permits. At the moment, they are registered as building plots or agricultural land.
The new bill also regulates penalties for registered owners of property who fail to pay their Immovable Property Tax. Originally the penalty was set at 20% on the tax due but this has now been reduced to 10%. There is also a 10% reduction if the tax is paid 30 days or more before the deadline.