Buying in Cyprus explained: how to find a perfect slice of island life with tax breaks and European residency

The late afternoon flight from Stansted to Paphos isn’t full of holiday makers chasing the mid-summer sun. Most British people on board are returning home after their first trip to the UK since Covid-19.

One retiree who has lived in Paphos for 30 years was back for her father’s belated memorial – he was an early victim of the pandemic. She is sat behind a young mum with a 10-month-old who had popped back to England for a wedding.

Both have chosen to live in Cyprus full time for the "quality of life".

"Cyprus has the most Blue Flag beaches per kilometre of any country in the world and there is nothing dangerous in our waters," says, Alan Quinn of the estate agent Elit Blue, referring to the marine wildlife. "Lifeguards are run by the Government and our streets are very safe," he adds.

The new Permanent Residency Programme (PRP) is driving demand to relocate to Cyprus. In return for buying a new property worth a minimum of €300,000, plus 19 per cent VAT, non-EU nationals (such as the British) have the right to live in Cyprus and travel freely across Europe (apart from the Schengen Zone). The requirement is to visit the property every five years.

However, the transaction tax on the sale drops to just five per cent if it becomes a full-time home. The tax perks also extend to zero capital gains tax, zero foreign income tax and zero inheritance tax and the owner can apply for citizenship after five years.

Pantelis Leptos, co-president of the developer Leptos Estates, describes it as "arguably the best fast track programme in Europe that permits foreigners to acquire an Immigration Permit through property investment." The process can take as little as 60 days.

Where to buy in Cyprus

Paphos, south-west

Yes, Paphos has a strip of sports bars and karaoke clubs with familiar-sounding names such as Chalkies bar or the Robin Hood Club. But the British bar scene does not detract from the ancient traits, identity and beauty of Paphos.

The low-rise, low-density harbour city, dates back to Neolithic times and has several sites linked to the goddess Aphrodite – including Petra tou Romion or Aphrodite’s Rock off the coast between Paphos and Limassol.

One legend has it that the stone sea stack was her birthplace. The UNESCO archeological site of excavated tombs – the Tomb of the Kings – originates from the third century and is two miles away. For the active, there are three golf courses and plenty of water sports.

The Coral Bay region is undergoing the development of trophy villas on the hillside roads, which run up from the five-star, family-friendly Coral Beach Hotel (coral.com.cy). This hotel has 422 rooms and overlooks 300m of sandy beaches in a calm bay.

The Coral Seas Villas is an exclusive, gated community to the west of Coral Bay, being built by Leptos Estate, the country’s second largest landowner after the church (leptosestates.com).

The first row of villas commands a hefty premium due to their cliff top position and uninterrupted views – Cypriot law means the last section of land running around the coast cannot be built on.

These white villas with private pools are already planted with herb beds and brightly coloured shrubs shrouding each dwelling. The largest available, a five-bedroom home, is on the market for €3,399,000 plus vat.

Just a few rows back from the sea and prices drop to €699,000 plus vat for a three-bedroom villa around a communal swimming pool.

More traditional villas are available in the Kamares Village, nestled on the hillside with views of the ocean. Homes in this rustic development (again by Leptos) have red Roman tiled roofs and arches (kamares) of local stone surrounded by olive, citrus and carob trees.

Prices start from €440,000 for a two-bedroom home to €5,768,000 plus vat for a brand new five-bedroom villa.

Limassol, south coast

Inland, above Paphos and Limassol, are the Troodos Mountains, Mount Olympos (1,952m) and the 173-acre Paphos Forest.

This is horse riding, hiking and cycling country with plenty of wildlife: 83 species of snake, Red Fox and Mouflou. Authentic tavernas can be found up in the rocky villages such as the Linari Tavern in Agros and Agios Demetrios in Kato Platres.

Head into Limassol for a totally different experience. This fast growing business centre has traditionally attracted Russians but is now home to a burgeoning community of digital nomads from across the world.

There are several different developments underway. Trophy homes can be found, ready to move into, in the Limassol Del Mar seafront apartment complex. There’s a communal deck and infinity pool overlooking the sea. Prices start from €1,655,000 for a two-bedroom apartment with a private terrace.

The other scheme (also Leptos Estates) is Limassol Blu Marine, two residential towers above boutiques with one-bedroom apartments starting from €655,000.

Both are part of a Limassol masterplan which also includes the construction of Europe’s biggest integrated gaming resort, the City of Dreams Mediterranean. The 14-floor casino and hotel complex will have three swimming pools, a family adventure play park and nine restaurants.

Ayia Napa and the east coast

Quinn of Elit Blue (an affiliate of Savills) flies the flag for the east coast. He describes the renowned party hotspot Ayia Napa as "high end" and one of the most highly sought-after areas of the island for tourists and relocators.

There are two acres of sculpture parks and the Ayia Napa Marina with 220 luxury apartments, 35 villas and 600 berths, as well as restaurants and shops. Party people head for the 500m-long Nissi Beach, which is one of the most photographed beaches on social media with DJs and foam parties.

He also cites the resort town of Protaras for families and Larnaca – the third largest city on the island, with a palm tree-lined seafront, built on ancient ruins.

"A four-bedroom villa in the centre of Protaras with a roof terrace swimming pool will go for €485,000 whereas a three-bedroom apartment will be closer to €350,000," says Quinn. There’s a detached house for sale with three bedrooms and a private pool (under construction) for €342,000 on the Elit Blue website (elitblue.com).

While entry prices to Ayia Napa marina start around the €1 million mark, there is a three-bedroom villa for sale with a private pool and balcony just 50m from the sea for €320,000 on prime-property.com.

While Brits make up 70,000 of the 1.2 million population of the island, which has traditionally attracted Russians and members of the former Soviet Bloc, Cyprus is a diverse place, according to Leptos sales executive Kostas Constantis.

"Whenever there is a crisis in the world, more people settle in Cyprus," he says, referring to the Arab Spring and the ongoing Syrian Civil War. Leptos also built Neapolis Paphos University where Russian and Ukrainian students work side-by-side.

Quinn believes the pandemic has boosted sales to Brits. “Those who can truly work remotely have realised that rather than moving out of London to the countryside realise they can move overseas to an island with 320 days of sunshine a year, four and a half hours from the UK," he says.