Cyprus property market reaction after 3,700 foreclosure cases filed

By in
Cyprus property The previous image was unrelated to the article published here in and as a result a more suitable selection has been made. Cypriots used to borrow a lot from banks. It is common to have several properties in Cyprus. This is about to change as the uncommon procedure of foreclosure of defaulted property is coming into force. The Cypriot economy was hit by the 2013 banking crisis leading to dissolution of the Laiki bank. Cyprus received a €10bn rescue package from the EU in exchange of implementing painful structured reforms in the banking sector and the economy as a whole. The Cypriot property industry has many shortfalls. Among them are a problem with title deeds (it usually takes about 6-8 years to obtain a title deed for a property) and inability of Cyprus banks to repossess mortgage defaulted properties. The later one was addressed during the bail-in and the Cyprus government had committed to implement it.
Cyprus banks have a very high ratio of non-performing loans.
Cyprus banks have a very high ratio of non-performing loans (NPL). A total amount of NPL was about €26bn. NPL represents a serious threat to the Cyprus banking sector. If Cypriot banks press harder on NPL, the property prices could drop further. The property market was among the worst hit in Cyprus and down by about 40% comparing to its peak. Cyprus is well known for its mild sea climate attracting a number of tourists, offshore companies and a wide spectrum from the financial sector.