should I buy in north cyprus? sales guy predicting 150% profit by 2009!

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bramasole

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Hi

Has anybody been talking to a company about a development in north cyprus? A spanish company is selling 3 bed villas near beach off plan to begin development in 2009. I'm being told that I can sell the villa in 2009 before I even have to make the first build payment and make 150%. All I have to do is buy the land, pay some legal fees etc and wait and see.
Anyone ever done this. It sounds great but I'm nervous about it.

Thanks
 
jbutler said:
Hi

Has anybody been talking to a company about a development in north cyprus? A spanish company is selling 3 bed villas near beach off plan to begin development in 2009. I'm being told that I can sell the villa in 2009 before I even have to make the first build payment and make 150%. All I have to do is buy the land, pay some legal fees etc and wait and see.
Anyone ever done this. It sounds great but I'm nervous about it.

Thanks
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Sadly, Auto320 is not here to advise.

But a couple of random things to worry about:
1. Land title in Northern Cyprus is often under dispute as many properties were expropriated following the Turkish invasion and partition of the island.
2. What is the tax situation if you make 150% on the price you paid?
3. Have you talked to an independent solicitor?
4. Why will prices appreciate so much in Northern Cyprus, with it's difficult political situation and it being outside the EU? Does a Spanish property developer know something about the local geo-political situation that the rest of the world don't know?
5. If it sounds too good to be true, it is.
 
ubiquitous said:
Well he would, wouldn't he?
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Exactly - try getting some independent advice and crunching the numbers to see how realistic the sales guy's claims are. Bear in mind the little issue of the ongoing unrecognised status of the Turkish Republic of Northern Cyprus and the possibility that the land on which this development is taking place could feasibly be subject to legal claims by people who left/were moved out following the events of 1974!
 
yeah I have look into those issues alright. I was hoping to make some money so that I can buy something in france. I feel like I'm taking a chance but I can't seem to find much on this company.

According to them they have been operating from Marbella for seven years and have recently set up in UK. they are very confident about this. has anything like this ever worked out for anyone, or is it all horror stories?
 
where do I get independent advice? I will admit I am new to this stuff. making a fortune is not on my agenda but I do have this love for france and really want to fund a little holiday home there.
 
I can't advise re north cyprus but if France is where you want a holiday home ultimately why don't you look into buying a buy to let there now? If you know what area you like, then just go over there and have a look in the local estate agencies. Buying locally can often mean savings as opposed to buying some of the much hyped leasebacks or through a geared Irish or English agency. You will also be able to research locally the rents available when letting and make an appointment to see if you could obtain a French mortgage to gauge the interest rates and see if it is affordable or even a good investment. If it is not a good investment financially try to let your head rule your heart. Remember that realistically how many weeks of the year are you going to use that holiday home and would you be better off just renting for your annual holidays for the time being.
 
Yes it probably makes more sense financially to just rent annual holidays.

This cyprus thing just sounded like an easy way to buy the france house... I have looked into buying there but nothing promises the returns like north cyprus.
 
jbutler said:
nothing promises the returns like north cyprus.
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Did you read the earlier posts? This is what a sales man is telling you. You cannot take such claims at face value.

No offence but if you are that naive to even consider believing what a sales man tells you then I wonder if you should be buying investment property at all.
 
Ok tell me this then...

How do I go about validating what a sales man tells me. I am taking what he says as sales talk but I guess what I'm looking for is the method people use to arrive at a safe decision.

what tools are available to me ? online tools? research options? and the obvious one, find a solicitor.

I was told that the contracts were drawn up by an english law firm but the title deeds have been validated by local firm of solicitors.

should I get another local firm of solicitors to check again? should I get a uk solicitor to check the contracts?

sorry, these are probably novice questions, but that is what I am!

thanks for help.
 
That's a difficult one. Have you been to the area? Certainly that would be my first step. While you are there why not have a look at the local real estate agencies and see what is selling and for how much. See what the holiday market is like, and what rentals are commanded and what occupancy can be expected. Talk to some local agents. Maybe even talk to a local solicitor- though I don't know what the legal system is like over there. Certainly as an Irish solicitor I wouldn't dream of advising on property investment here. All I can do is advise on the legal aspects so maybe it is the same there- but at least if there is doubts over land ownership you should be able to find this out.


Also of course use the internet but take what it says with a grain of salt. There are many biased posters on the internet too.
 
I would have assumed that, above all else, the unrecognised status of the TRNC would make buying in that region extremely risky? For example since nobody but Turkey recognises the TRNC and everybody else recognises the sovereignty of the (southern) Republic of Cyprus over the whole of the island (including the area currently claiming to be the TRNC) then would buying a property that is processed by the illegal jurisdiction (e.g. their equivalent of the Land Registry or other state organisations or whatever) not be legally questionable altogether?
 
If only legal fees have to be paid at this stage, then why doesn't the estate agency buy all of these for itself if 150% profit is so likely on such a small outlay?

Be extremely cautious of any agent who tries to predict the future so conclusively, particularly those with such outlandish expections.
 
jbutler said:
According to them they have been operating from Marbella for seven years and have recently set up in UK. they are very confident about this. has anything like this ever worked out for anyone, or is it all horror stories?
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I'm not so sure that 'operating in Marbella' for several years is much of a recommendation.

[broken link removed]
 
its not that small, they want about 45 thou which is the land + fees.
I am being cautious and, of course, not believing everything I'm told by sales guy.

As for TRNC, am aware of this having had v. interesting conversation with cyprus embassy during the week.

Note: am not naive, am inexperienced! theres a difference...
 
What is your attitude to risk? Would you be willing to invest 45k plus in a start up enterprise that specialises in something other than property?

Can you afford to lose all of your 45k?

What exactly is due to happen in Northern Cyrpus in the next 2 years that will lead to such a massive appreciation in value?
 
according to the company selling these villas, they got them at a discount price already, so already 40% discount compared to developments going on right next door. then they are adding on capital gain based on previous years performance.

I can't afford to lose this money in reality. It wouldn't be devestating but I'm by no means rich. So my attitute to risk is fairly cautious.

without naming names does anybody know who I'm talking about by the way?

embassy just said what you did, but in a slightly longer more verbose way.
 
jbutler said:
according to the company selling these villas, they got them at a discount price already, so already 40% discount compared to developments going on right next door. then they are adding on capital gain based on previous years performance.
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Do you actually believe this?
I can't afford to lose this money in reality. It wouldn't be devestating but I'm by no means rich. So my attitute to risk is fairly cautious.
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This is almost certainly the wrong investment for a cautious investor. If you have not realised this at this stage then I'm not sure what is going to convince you.
embassy just said what you did, but in a slightly longer more verbose way.
Click to expand...
So - do you not consider the political situation to be a key risk here?
 
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