It is auction time in Cyprus – over a hundred properties will be auctioned off soon. The properties to be auctioned include luxury mansions. A hotel and other properties worth €24.6 will be auctioned off as well. We discuss more about this and tell you what it means for you if you’re looking to sell your villa in Cyprus fast.
The reason for this extreme step was the failure of the property owners to pay back the loans to the banks. The Bank of Cyprus has resorted to the auctioning process to retrieve at least some of the value of the loans. This shows that Cyprus is serious about following the conditions laid out by the €10 billion bailout by the EU and IMF.
The properties to be auctioned off were earlier foreclosed by the banks against non-performing loans which were terminated after a prolonged legal procedure that began in 2009. Auctions were carried out in Paphos last month in which three plots were sold, which yielded a total of €1.05 million. In Nicosia, 4 plots were sold.
The Bank of Cyprus also carried out auctions in the districts of Limassol and Famagusta. The Cooperative Central Bank and Hellenic Bank will be holding their own auctions shortly.
The Cyprus government has introduced a new law, according to which banks can auction off a property at a reserve price of 80% of the current market value. In case there is not much interest shown, the banks can then place the property in a new auction in a year’s time, but with a new reserve price that would amount to 50% of the of the current market value.
Interestingly, two of the luxury mansions to be auctioned off belong to the same family - a father and daughter. Each of the mansions is worth over €1 million and was used as a primary residence. The owners of the properties did not pay even a single Euro of the loan amount to the Bank of Cyprus. The bank officials insist that the owners are very much in a position to pay the loan but refuse to, for reasons only known to them.
The property is situated in a posh Nicosia neighbourhood. It has a private swimming pool, a built-up area of 520 square metres, and a smaller house within the premises. There is a lot of interest shown by the public in both the luxury properties to be auctioned off. Each is expected to fetch bids of at least €1 million.
There is no question that the Bank of Cyprus and other banks in the country have forced several rich homeowners to restart the process of paying back their loans by taking this extreme step. Many homeowners have already paid back their debt in full, out of fear of losing their properties.
22 plots of land are also up for auction shortly, as is a hotel reputed to be worth €850,000. Things are happening very fast in Cyprus banks have been forced into action by the EU and the IMF.
This has created positive signals for the economy. Investors can see that Cyprus is serious about cleaning up the financial system. If you want to sell your property in Cyprus online, you should certainly take advantage of the newfound confidence in the Cyprus economy.