Renting in Cyprus

DID YOU KNOW? Cyprus is unique in the fact that under the law, a tenancy of any duration is not valid unless in writing signed by the parties and witnessed by two witnesses, whereas the sale of land does not have to be witnessed by anyone!  As such, it is essential that two witnesses (other than the contracting parties) witness the signing of the lease agreement.

Below are some of the most frequently asked questions about renting in Cyprus.

1. Who is a tenant?
   A tenant can be either a natural person (i.e. you or me) or a legal entity (i.e. a company or partnership) which has its usual place of residence in Cyprus.  A recent decision of the Rent Tribunal has however, extended the term ‘tenant’ to encompass any EU citizen and company.  This term also includes: a protected tenant (i.e. one protected under the Law;) a sub-tenant; surviving spouse or off-spring of a tenant; the separated spouse and off-spring of a tenant who has abandoned the home; and the government.
2. Who is a landlord?
   A landlord is again any natural person or legal entity who would be entitled to the possession of the rented property, and in the case of a sub-let, the tenant sub-letting the property.
3. What kind of property can be rented?
   A ‘property’ under the Law means a building (a house or shop) being rented or available for rent, situated within the boundaries of a ‘controlled’ area (areas of Cyprus defined in the Law) and which was built before 31st December 1999.  The Law also covers listed buildings.  A ‘shop’ is defined in the Law as being any property which is being rented for work (including offices,) or for any other professional purpose and is being used as such.  A ‘home’ is defined as a building or construction or part thereof, that is being rented as a house for people, or for the housing of a club, society or other non-professional organisation.
4. What is Rent?
   The rent is any sum of money that is paid as ‘rent’ for the property, and for the use of the furniture in the case of a furnished property being rented.  Rent however, does not include common usage costs, such as the maintenance of the lift, lighting of the stairwell etc.
5. What is a Tenancy?
   A tenancy like many other legal relationships is in essence a contract between the landlord and the tenant. The Law in general does not interfere with what has been agreed by the parties, but places certain basic limitations aimed at protecting the tenant.
6. How much can rent be increased per year?
   The rent cannot be increased by more than 8% every two years. If for example, a tenant signs a contract in which it states that he will pay a 25% increase per year in rent, under the Law this clause is invalid and thus unenforceable by the landlord. The maximum the landlord would get if he went to court seeking an increase in the rent, is 8% every two years. The Law overrides the contract.
7. When can a landlord evict a tenant?
   The Law does not allow the landlord to evict a paying tenant, except for reasons which are stated exhaustively in Article 11 of the Law. These include :
   1. The non-payment of rent, with specific time frames and notices required to prove so;
   2. If the tenant is guilty of nuisance or uses the property for illegal or immoral purposes;
   3. Due to the destruction of the property by the tenant;
   4. If the tenant sub-lets the property, having undertaken not to do so in the lease agreement;
   5. If by legally sub-letting, the tenant makes such a profit that the court may find it reasonable to end the tenancy;
   6. In cases where the property is reasonably required by the owner for his housing (special limitations apply;)
   7. In cases where the shop is reasonably required by the owner to house his own business (limitations apply);
   8. In cases where the property is reasonably required for demolition or major structural changes;
   9. In cases where the tenant has to leave the property, in order for a plan for its development to be put into effect;
   10. In cases where the property is compulsory acquisitioned by the government;
   11. For reasons of public interest;
   12. In cases where the tenant gives written notice that he intends to vacate the property and consequently, the landlord has entered into a new contract with another tenant /taken other measures and the court is of the opinion that the landlord would suffer damage if the tenant was not evicted.
8. What are the key terms to be included in a Lease Agreement?
   Description: The full address of the property.
   Duration of Tenancy: The most important term of any lease agreement is the duration of tenancy.  Whether you are a landlord or tenant, the duration of a tenancy will to a large extent, represent the amount of damages you would be able to claim if the tenancy agreement is breached.  Therefore, depending on the purpose of the tenancy, it is always a good idea to have a termination of the tenancy clause.  The termination clause will in effect, cap the maximum amount of damages recoverable by the other side, if there is a breach of the agreement.
   The Rent:  How much to be paid, when and how, as well as the rent increase rate.
   Furnished Properties:  A detailed description in an ‘Inventory Form’ of all the furnishings that will be rented.
   Landlords Duties: A clause maintaining that the structural, electrical and plumbing installations are the liability of the landlord etc.
   Damage: A clause stating that the tenant is not liable for fair wear and tear of the property, nor for damage to the property caused by reasons other than by the tenant.
   Security: The security to be held by the landlord.  it is common for one or two months rent to be held as security for any damage caused to the rented property by the tenant.