TRNC eases rules for real estate sales to foreigners

A new decree regulating the sale of real estate to foreign citizens has come into force in the TRNC. The document, published in the official gazette, introduces new rules for transaction registration, security control, and taxation, while simultaneously significantly expanding the opportunities for foreign buyers in the housing market.

According to the new provisions, foreigners will be able to purchase up to 80% of residential units in approved construction projects. Furthermore, citizens and companies from countries recognizing the Turkish Cypriot administration will be allowed to participate in construction projects jointly with local contractors, provided that the foreign share does not exceed 49%.

The new law also provides for the creation of a system of "licensed intermediate investors." Such intermediaries will be able to offer foreigners at least ten real estate objects annually without registering ownership in their own names.

A transition period is introduced for transactions concluded before the 2024 legislative changes. Real estate owners who exceeded the permitted limits will be able to legalize their purchases by paying a fee of 1% of the object's value within six months. After this period, the rate will increase to 3%.

In cases where the volume of acquired real estate exceeds the permitted norms, buyers will be issued a special "certificate of use" for a period of ten years. In this case, ownership remains with the seller, while the foreign buyer receives the right to use the object.

According to the decree, foreigners can purchase up to three apartments after cabinet approval. For citizens of countries recognizing the Turkish Cypriot administration, the limit has been increased to six apartments.

Additionally, strict security requirements are introduced. Foreign buyers are required to provide a criminal record certificate with an apostille and undergo a check regarding the proximity of the acquired real estate to military installations.

A separate clause of the law provides for sanctions for non-payment of taxes and fees: in such cases, properties will not be connected to water and electricity supplies.

The new decree has already caused a wide public resonance in the TRNC because, despite the stated restrictions, it effectively opens the real estate market to a significantly larger number of foreign investors.