Economist and ex-banker Symeon Matsis speaking to the Sunday Mail, said that the fall in property prices would have been worse if the banks pressed developers to service their loans by reducing property prices still further to encourage sales. His statement confirms widely held reservations that property developers are receiving insufficient income from property sales to service their loans – and that the banks are not pursuing them for payment.

Developers arrears are on the increase and the banks are bracing themselves for a further haircut on their Greek bond holdings. Banks tentatively agreed in July to take a haircut of around 21%. However, analysts are now saying that they may have to accept losses of between 50% and 60%.

Mr. Matsis commented: “If the companies were pressed into selling their assets, this would cause a drop in the value of collaterals”.

The Cyprus cabinet has approved three draft bills designed to shore up the banks that are heavily exposed to Greek government bonds and to establish an independent financial stability fund as well as immediate action to ensure stability for the management of the financial crisis. Government spokesman Stephanos Stephanou, based on recent developments said that the three bills approved by the Council of Ministers offer the required institutional and legal framework enabling Cyprus to mediate and back the financial system, should the necessity arise.

The first bill will allow the government to step in and reinforce a bank’s liquidity if required. The second bill would create a fund to help steady the banking system due to heavy exposure to Greek sovereign debt (estimated at some €4.2 billions) and with a high risk of default. The third bill extends the existing special tax for credit institutions. Although there is no money to put into the fund, a package of austerity measures has been approved by the government which includes such stalwarts as cutting 1,100 already vacant positions in the civil service and reducing entry-level salaries for civil servants by 10%.

THE INVESTORS Chronicle reports that overseas home ownership has rocketed over the last 10 years with an estimated 500,000 Brits has purchased property overseas and it has been estimated that the value of their purchases increased from £10 billion in 2000 to a peak of £58 billion last year. According to property consultancy Savills, The price decline due to the credit crunch in many of the once popular foreign property hot spots means that the majority of the Britons who bought property in 2007 and 2008 will be in negative equity.

Monica Antoniades of Capital homes in Paphos said that the Cyprus property market is steadily reovering although there is massive reduction in the number of house purchases being completed. She said that People are still eager to buy in Cyprus, but they’re exercising caution, and waiting for the situation to stabilise before taking the plunge.

She commented: “I’m hoping things will improve, There are still people who can’t afford to buy in the UK, and they’re moving out here. People are just taking a more sensible approach.”

There has been some good news from the Cyprus land registry with sales figures for Cyprus from foreign buyers being relativity unchanged at roughly half their heights of 2006 with 10,766 purchases in 2006 and till August there has been 4709 purchses already this year. With the prices decline in tourist hotspots, buyers are currently faced with the dilemma of holding on for longer to get a better deal or want to buy it as an investment for long term. However, there is no denying that there are some great properties to be had at very reasonable prices in Cyprus currently.

Famous for its happening atmosphere and welcoming hospitality, the sparkling city of Limassol is only a few hours flight from most European cities. The new marina will be a collection of well-designed residences and state-of-the-art marina with top class restaurants and shops, creating a lifestyle exclusively coined by the term living on the sea.

Demetris Christofias, The President of the Republic of Cyprus has laid the foundation stone of the new Limassol marina which was attended by the town’s officials and other dignitaries. Construction work on the Limassol Marina is already is on the move and progressing rapidly. The marina project is one of the largest in Cyprus and aims to promote Cyprus position on the map as a quality tourist destination and should be ready to accept its first vessels in the autumn of 2012.

Despite the general slump in the property market, sales are excellent. The first units to be delivered in about 2 years time will be the nine blocks of apartments known as the Nerieds (sea nymphs). Prices for one bedroom apartments start at €450,000 and two bedroom €800,000 and many of them already have been sold to Russian, European and Arab investors.

With an estimated cost of €350 million, other plans for the marina complex include boutiques, restaurants, cafes, shops and conference space, all with the aim of attracting more high-end tourists to the island and a bigger share of the Mediterranean yachting market. The marina will be expected to be ready by 21st October 2012 and will able to accommodate around 600 craft of various sizes.

According to the latest figures published by the Department of Lands and Surveys, domestic sales of property in Cyprus during the first seven months of this year increased by 21% over the same period in 2009 with 4,100 contracts being deposited this year compared to the 3,396 deposited last year in contrast with the 0.3 percent fall in sales to overseas buyers.

However, Cypriot buyers deposited 630 contracts of sale at Land Registries throughout Cyprus during July compared to the 652 deposited during July 2009; a fall of 3.4 percent. The largest increase in demand this year is Paphos (up 27.2 percent), followed by Limassol (up 24.7 percent), Nicosia (up 23.3 percent), Famagusta (up 13.1 percent) and finally Larnaca (up 11.8 percent).

In more good news, budget airline Ryanair stated that it has not ruled out launching flights to Cyprus from the UK, which would be good news for anyone with property in the nation.

Chairman of the Association for the Promotion of Property Development George Mouskides said that matters should now improve in the coming months as the world economy begins to recover. The situation in Cyprus will begin to become more positive and this, according to all visible signs, will first and foremost influence the property sector.

The report stated that the country’s real estate market, which is a significant component of the banks’ loan books, remains a risk area with unclear growth prospects and weak demand.

Cypriot government approved the creation of a Financial Ombudsman, offering a cheaper and more simplified option of dealing with economic disputes. Consumers can apply to the Ombudsman to seek out-of-court settlements on disputes with financial institutions (FI). In good news for property investors, Consumers will be able to submit complaints of a financial nature and the Ombudsman can mediate and arrange a friendly out-of-court settlement.

In General, consumers will be able to seek compensation without having to go through exhausting court procedures. However, if consumers wish, they can turn to court. Ionas Nicolaou, The Legal Affairs Committee chairman said if there were any problems in its implementation, amendments would be made.

In more good news for investors, foreign interest in the Cyprus property market is showing signs of a recovery with sales during the first half of 2010 up 9.6% on last year. According to figures released today by the Cyprus Department of Lands and Surveys, A total of 231 property sale contracts in favor of foreign buyers were deposited at Land Registries throughout Cyprus in June 2010, compared to 201 in June 2009; an increase of approximately 18.5% compared to last year.

When sales traditionally slide off at this time of year, the highest number of monthly sales this year is what more interesting to the analysts. It is highly unlikely to be a pure coincidence that this rise in sales against the season comes as the government and Cypriot legal institutions have been working hard to resolve the problems over Cyprus title deeds.

New legislation from the Cypriot government promises to allow people to get their deeds issued from the land registry, from the moment they pay the deposit and sign the sales contract. This will stop developers from selling to multiple people.

Les Calvert director of overseas property portal Property Abroad.com gave a reason for his strong belief in the Cyprus property market that they believe strongly in the Cyprus property market, because the credit crunch will actually have a benefit. Because so many people lost money on developments that will never be completed, today’s buyers are increasingly keen to do their own research. For that reason the problems that Cyprus has had with title deeds needn’t stop people from buying in the country.

Meanwhile, Cyprus’ new golf courses and proposed 2nd Eurodisney are one of the few reasons to believe that Cyprus property has a bright future. The Cyprus government gave permission to build 14 new golf courses on the island; permission was granted last year and construction has started on one of the courses.

The total area of projects that registered building permits in January increased by 11.6% to 278.9 thousand sq. meters compared to 249.8 thousand sq. meters in the corresponding month of 2008, when they had decreased by 5.3% compared to 2007. The value of building permits authorized rose for the eighth straight month, rising by 6.9% over January 2008 to EUR 234.1 mln, suggesting that developers are still making money and these building permits is for the construction of 1,585 dwelling units which is also up from 1,229 in January 2008, according to financialmirror.com reports.

The area of the projects in Famagusta registered an increase of 41.6% to 29.3 thousand square meters from 20.7 thousand square meters. In Paphos, 30.8% to 53.7 thousand sq. meters from 41 thousand sq. meters in January 2008, while in the commercial port of Limassol it is 6%, in Larnaca of 2.9% and in Nicosia of 3.8%.

In related news, the Bank of Cyprus is offering attractively priced loans of up to EUR 1.5 billion earmarked for housing, business and the hotel/construction industries. Vassos Shiarly, The Bank of Cyprus Group General Manager Domestic Banking has stated that € 800 million are geared to soft loans for housing and businesses wishing to own their own premises.

Marilyn and Hamish Lowdon from Aberdeenshire has stated that All legal documents and paperwork are in English, most solicitors are bilingual both well versed in Turkish and English, and the legal system is based on UK. Given the right circumstances, foreign buyers can be the owner of a Cyprus property in just a day! The couple has bought their property near Paphos – which features a large balcony and shared communal area with a pool – for £172,000 in 2005, According to Sunday mail reports.

According to the publication, IT consultant James Allen, 31, is just one of the many Brits who have chosen to purchase property in the country. He paid for a deposit on a flat in Paphos in 2006. Mr. Allen now believes similar properties in the area are selling for around 30 per cent above what he paid.

He said that initially he was looking at a flat to buy and rent out in Scotland but he couldn’t find anything that would give him decent returns so he decided to look for properties abroad and selected Cyprus. Although his flat will not be finished until 2010, Mr. Allen has stayed in a completed part of the development.

However, in Northern Cyprus Non-nationals require a purchase permit from the government in order to buy property and such permits may take 4-12 months to come through.

Meanwhile, Cyprus has topped the list by Jet-to-Let magazine to determine the countries of most interest to property investors this year. Cyprus finished first for the second consecutive year, closely followed by France and Spain in second and third respectively. The government has launched first-time buyer scheme in Cyprus and a total of 200 million euros was set aside for the initiative. Cypriot finance minister Charilaos Stavrakis has approved the first 30 loans, which aim to help first time-buyers onto the country’s property ladder.

As there is a steep increase in the number of first-time buyers interested to get on to the property ladder in Cyprus, Government has announced a total of 200 million euros for the initiative. The scheme is officially underway as Cypriot finance minister Charilaos Stavrakis has already approved the first 30 loans for an average amount of 140,000 euros and totalled some 4.2 million euros.

Charilaos Stavrakis Commented: “30 loan applications have been approved within fifteen days after the announcement of the plan; particularly to young couples… the total amount of the approvals was over four million euros from the overall 200-million euro scheme”.

The Bank of Cyprus also has recently launched an 80% Loan to Value and provides a two year payment holiday scheme for off-plan purchases. The interest rate is also capped at 5% for the first three years. Now this scheme is only available for Cypriot residents and Industry experts believe that similar schemes to be rolled out to non residents in the coming months.

Steve Wright, managing director of Cherish Properties, suggested that Cyprus is experiencing strong growth. Cyprus has seen 20-30 per cent growth and it is now predicted to grow by around ten per cent a year, reports Birmingham Post.

Peyia is a small coastal town next to Coral Bay and a short drive or a bus ride to Paphos, the ancient capital of Cyprus with its historic ruins including the “Tomb of the Kings”. There are many shops, restaurants and bars that cater for both locals and the many holiday makers.

Islandproperty promoters have come up with this novel idea. There are 18 supreme, fully equipped and furnished luxury apartments situated in small purpose built private complexes deliberately built for those who want those quick “Get away to the sun” breaks. Each apartment has a double bedroom, a sitting room, a kitchen and a shower room and they will also have a small private garden or a balcony. Each complex also has off road private parking and a shared and fully serviced private pool.

Buyers those who are interested all have to do is to buy a ticket for €20 and submit your answer to the Where did the golf ball land? Question. There are 18 draws for 18 apartments and once 8000 tickets have been sold, that Draw is closed and the next one will be open. The answer in each draw will be different. The competition adjudicators are KPMG accountants and the question and answers for all 18 draws have already been lodged in sealed envelopes. KPMG accountants and Vlamis Law Office of Cyprus will account for all monies received.