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Property in North Cyprus is relatively low cost and is some 40% cheaper than equivalent property in Southern Cyprus, and around half the price of property in Spain.


The reason for this is the fact that Cyprus is a divided island. The South is referred to as the Republic of Cyprus, and is part of the EU. The South is Greek while the North is Turkish. The North is also referred to as the Turkish Republic of North Cyprus (TRNC), although only Turkey and a few other countries recognise the region as an independent state.


The UK Annan Plan of 2004 attempted to re-unite the island prior to the EU accession. The plan was put to referenda. The North voted in favour of the plan, while the South voted against it. Despite this, the Republic of Cyprus became a member of the EU in 2004.


The property issue therefore remains unresolved. During the communal strife of 1974, Greek Cypriots fled from the North to the South and abandoned their properties in the North. Conversely, Turkish Cypriots fled to the North from the South. Greek Cypriots claim that up to 80% of land in the North really belongs to them.


The government of North Cyprus has issued title deeds since 1980. Some of these title deeds refer to land which was either owned or occupied by Greek Cypriots prior to 1974. North Cyprus title deeds fall into several categories.


These are, firstly, internationally recognised pre 1974 title deeds issued to Turks, Britons etc. These title deeds are recognised by the Greek Republic of Cyprus and are therefore considered absolutely safe. The problem is that there is very little land of this type, in attractive locations, coming to market. Most land is either already built on or is in a relatively inaccessible location with little prospect of mains services.


Secondly, Exchange title deeds, which were issued by the North Cyprus government to Turkish Cypriot refugees who had abandoned land in the South. The allocation of this land was allegedly based on a quid pro quo arrangement. As many Turkish Cyprus had valuable holdings of land in Paphos, Larnaca and Limassol, this process does have credibility. The Turkish Cypriot then signed over his property in the south to the TRNC government to be held by them pending a negotiated resolution and settlement between the north and south Governments. The owner of such a title deed is allowed to sell the property it relates to.


Thirdly, Points Based title deeds which were awarded for military service and to widows of servicemen. In addition, title deeds were given to immigrants from mainland Turkey in an effort to encourage settlement in some of the more under-populated areas of North Cyprus, especially the Karpaz peninsula. The presence of settlers in what were predominantly Greek areas is an ongoing source of bitterness and rancour between the Greek and Turkish communities.


Under the provisions of the Annan Plan, any land which has the benefit of TRNC title deeds, and has been developed, is safe from restitution. This is true even if a Greek refugee has credible title deeds. Developed land is defined as land which has been improved by the construction of a property, as opposed to vacant or agricultural land. In these circumstances, the best a Greek refugee could hope for would be compensation. This could either be in terms of an offer of comparable land nearby, if any could be found, or a financial sum. Several informed commentators have made hypothetical calculations based on the Annan Plan formula, and for a typical building plot of 800 square metres, figures of between 4,000 to 6,000 pounds sterling have been suggested. The TRNC government has officially guaranteed all North Cyprus title deeds and has paid compensation in several well publicised cases.


What is decidedly unsafe, is land on which a derelict property stands. The likelihood is that this could be an abandoned Greek property. If so, it can be returned to the rightful owner, regardless of whether it has been renovated or not.


A buyer has traditionally been able to identify the status of North Cyprus title deeds. However, in recent years the North Cyprus Land Registry has made these distinctions less transparent. This is part of the political process to normalise the status of land in the TRNC.


The government of the Greek Republic of Cyprus promotes the hope that, one day, all dispossessed Greek Cypriots will return to their lands in the North. As time goes by, this hope becomes increasingly unrealistic. The Greeks were heartened by several rulings from the European Court of Human Rights (ECHR) in their favour.


However, in 2006 a landmark ruling was made in London when a UK Court refused an application by a Greek Cypriot for the return of his land and house which had been bought by Linda and David Orams of Brighton. The Orams were represented by Cherie Blair. In addition, the ECHR has effectively recognised the North Cyprus Property Commission as a legitimate local agency for the resolution of land disputes. This means that all future applications by Greeks to the ECHR will be referred to the TRNC Property Commission, with a right of appeal to the ECHR if the matter is not satisfactorily dealt with.


Prospective purchasers of North Cyprus property should be aware of the legal process of buying a property. All foreigners need to make an application to the Council of Ministers before any title deeds can be transferred into their name. Although this is a formality, it does take up to two years. During this time, a property will have been constructed for them, and they will have taken occupation. It is essential for a purchaser to be assured that the landowner is contractually obliged to transfer the land to them without further cost, and that the land remains free of mortgages or other charges until the title deeds are issued.


There is a sizeable British community in North Cyprus, but there are no brash tourist resorts or lager louts in the North. English is widely spoken, the cost of living is low, and fresh food is abundant. Many transactions, including property, are made in Sterling and there is a HSBC bank in Kyrenia and Famagusta.


The Greek community had a significant opportunity in 2004 to vote for a reunification of the island, but they rebuffed the proposal. With the benefit of hindsight, it is now clear that the Annan Plan was the best and possibly the last opportunity the Greeks would have to reunite the island and reclaim some of their lost land. The ongoing political stalemate and the marked increase in prosperity of TRNC would suggest that the partition of the island is set to continue.


Many overseas investors have already taken the view that no significant numbers of Greeks will ever return to the North and that the TRNC will remain independent of the Greek Republic of Cyprus. If this is the case, then North Cyprus offers attractive financial opportunities for investment as well as outstanding natural scenery and a relaxed, crime free lifestyle.