It’s been over five months since the June 23 referendum, which saw a majority of British citizens voting to leave the European Union. The Brexit referendum has had a serious impact on British expats living in Cyprus, with many trying to sell property in Cyprus fast.
The implications of Brexit are still being felt. Economically, Cyprus is not doing badly at all. In fact, the island nation has just recovered from a prolonged recession and things are better today than they had been for a long, long time.
So the Brexit vote couldn’t have come at a worse time for the real estate market in Cyprus, which is heavily dependent on British expats, who are the biggest buyers here. Further, the sterling hit a 31-year low last month. It has recovered since then and is worth 1.18 Euros.
But real estate observers in Cyprus are alarmed at how exchange rates have fluctuated recently. There is a lot of uncertainty in the air, and this is likely to continue for the foreseeable future because of the recent developments in Europe.
Italy had a referendum of its own last week, which saw the ruling party led suffer a humiliating defeat at the hands of Euro-sceptics. Prime Minister Matteo Renzi has offered to resign since then. This is seen as another blow to the Eurozone, coming soon after Brexit. The Euro has taken a tumble since then, which has only added to the uncertainty in Cyprus.
The biggest impact of the uncertainly in the exchange rates is felt by Britons living overseas, in Cyprus and elsewhere in Europe. Those who are dependent on a British pension have been affected the most from the issue.
Many British expats, who had been meaning to buy property in Cyprus online, have decided to postpone their plans for a bit. Many buyers who had been hoping to lock their purchase into a fixed exchange rate have lost a lot of hard-earned cash because of the fluctuations in the currency market.
So what does this mean for the overseas property market, especially for the real estate market in Cyprus? For a long time, Britons have been encouraged to buy real estate in Cyprus because of the strength of the British pound in comparison to the Euro.
Now that the advantage does not hold true any longer, British buyers are playing a waiting game. They are waiting for the Euro to crash further and for the pound to regain some of the lost value. Many have hired currency transfer professionals so that they can lock in a stable currency exchange rate.
There are also rumours that mortgage rates for British buyers looking to buy property overseas, including in Cyprus could be hiked.
The important thing is to stay informed and be aware of the latest trends in the real estate sector, and make decisions based on facts, and not on speculation. And yes, those who are looking to invest in Cyprus, or for that matter in any overseas property destination should have a clear exit strategy in place.