Rents: Can landlord and tenant freely agree rents in Cyprus?

The rental market can be divided into two broad categories: Houses controlled by the Rent Control Law (1983), and the free market. The Rent Control Law and its updated amendments apply to tenancies of residential or business premises which lie within what the law defines as 'Controlled Areas,' i.e., towns, suburbs and rural centres, which were completed before 29 December 1995. However foreigners (except the non-Citizen wife of a citizen of the Republic) and legal entities controlled by non-residents, are not covered by the provision of the law, and do not benefit from Rent Control Law protection.

After the first tenancy has expired or been terminated, the law allows for an agreed increase of maximum 14% of the existing rent, but not before the lapse of two years from the date of the last application, or the date of the last voluntary increase. In case of refusal by the tenant, the Rent Control Courts will determine a 'reasonable rent,' taking into account the opinion of the official valuer, and factors such as age, dimensions, location and condition. A rent control tribunal is composed of a president (who is a judicial officer) and two lay members, representing the tenants and the landlords.

What rights do landlords and tenants have in Cyprus, especially as to duration of contract, and eviction?

Before the EU negotiations, no foreigners could rent out property. Even today, non-EU property owners cannot rent out property.

Eviction of tenants is relatively difficult. The Rent Control Law introduced the concept of the 'statutory tenant.' This is the person who at the expiration of the first tenancy, in case of a property within the ambit of the Rent Control Law, remains in possession of the premises. A statutory tenant cannot be evicted except in three cases:

• Where he failed to pay the rent
• Where the landlord needs a house for himself or for members of his family or his dependent parents
• Where the landlord intends to demolish and reconstruct the house, or to effect such substantial alteration or reconstruction as to render the recovery of possession of the premises absolutely necessary

Even in such cases, the Rent Control Court may order the landlord to grant to the tenant in lieu of damages, the right to a new tenancy after the reconstruction. Finally, the Court maw award damages equal to 9-18 months rent, and/or damages for loss of goodwill of a business.

For post-1995 houses the terms of the contract apply.

Deposits

(not known)

How effective is the Cypriots legal system?

Legislation

The Rent Control Law 1983. Agricultural land, furnished apartments for less than 6 months, hotels and petrol stations do not fall within the ambit of the Rent Control Law.

Brief History: Recent changes in Cyprus landlord and tenant law

The present law arose under circumstances that tenants needed extensive protection. The Turkish military invasion of 1974 caused thousands of refugees to move to Southern Cyprus and created serious housing problems requiring immediate steps to prevent landlords evicting tenants.