There’s more bad news for owners of property in Cyprus after the Russian government announced a clamp down on its officials and civil servants from owning property overseas.
Cyprus is a popular location for Russian property buyers and news of the proposed law is unlikely to go down well.
The aim of the Russian law is to end corruption and its first stage was passed by all of the Parliament’s MPs with none voting against, though there was one abstention.
The law will apply to MPs themselves, anyone serving in the military and those employed by the Interior Ministry and the country’s Federal Penal Service and many other official bodies including customs.
The legislation will also extend to the spouses and young children of those working for the government and as well as banning the ownership of real estate abroad, the law says their employees cannot have bank accounts or securities.
Fines and jail
Anyone found owning a property abroad could face prison for up to five years and be hit with a fine ranging from £110,000 to £220,000.
The new law is quite draconian by many standards as it also compels any civil servant who already owns a property abroad to sell it by June 1.
If a civil servant inherits a property, they must sell it or pass it to someone else within one year of inheritance.
On top of this, no civil servant will be allowed to buy foreign assets within three years after leaving their jobs.
In recent months the Cypriot property market has been hit with a number of major issues since its property speculation bubble burst which led to a crash in prices and a glut of unsold properties.
In addition, the EU announced late last year its intention of investigating the property boom which has led to thousands of unhappy buyers around Europe who have been saddled with properties they cannot sell and overvalued mortgages.
It’s already proving difficult to sell property on Cyprus as buyers stay away and the country is in dire need of another major financial bail-out to help keep it afloat.
Cyprus is among the most popular holiday destinations for Russians and, according to the most recent census, there are now more than 9,000 Russians resident on the island.
A recent survey highlighted who the Russian property buyers are in Cyprus and it found they tend to be entrepreneurs or business owners aged between 30 and 45, who are married with children.
They also tend to buy a holiday apartments in complexes rather than villas and they are willing to pay around £106,000 for a property they like.