Foreigners bypass the law on real estate purchases in Cyprus: authorities prepare new measures

A loophole has been found in Cyprus legislation allowing foreign citizens, especially those outside the EU, to bypass restrictions on purchasing property. This was reported by the Ministry of the Interior, noting that the existing legal framework is outdated and needs revision.

According to the current law, foreigners can purchase no more than one residential or commercial property and a plot of land up to two donums (around 2,675 m²) in Cyprus. For this, a special permit from the Council of Ministers is required. However, in practice, many buyers find a way to circumvent these rules: they register Cypriot companies and acquire real estate through them without restrictions. Subsequently, the foreign citizen gains full control over the company, and thus over the property.

This mechanism effectively renders the law ineffective. As a result, foreign investment in the real estate market has sharply increased, leading to higher prices and reduced access to housing for locals, especially young families. In addition, the state and municipalities lose part of their tax revenue, as many transactions remain outside direct control.

Interior Minister Constantinos Ioannou confirmed that the authorities have already begun work on a new law to eliminate the existing gaps. According to him, the reform will be a priority in the coming months.

At the same time, an initiative by MP Nikos Georgiou (DISY) is being considered in parliament, providing strict limitations: foreigners will be able to acquire only one apartment or house of up to 200 m². In addition, transactions will be monitored across all participants — from agencies to lawyers and accountants — to prevent circumvention of the rules and comply with anti-money laundering standards.

The new measures are expected to be presented to parliament soon. The authorities emphasize that the aim of the reform is not to limit investment, but to establish order and protect the interests of Cypriot citizens.