19.02.2022
One of the strangest things about real estate in recent times is insurance fraud, which many people are not immune from.
This caught the attention of some MPs, but nothing has happened since then, and I don’t expect anything, but it would be good for the public to know.
Signing someone else’s bank loan as a guarantor is another thing to watch out for. In a recent case, the client signed a guarantee on behalf of the buyer/borrower before the date of issuance of a separate title to the apartment. The document was issued four years ago, but, despite various invitations to transfer, the buyer never showed up, did not respond to letters and calls. The financier also sues the guarantor, so if the lender succeeds, he will get the guarantee and the buyer (borrower) will run away. We were told that the guarantor must take “appropriate” steps to transfer the apartment, which means paying off all taxes owed by the borrower and then suing the non-responding borrower (about seven years of legal battles).
In another case, a buyer bought an apartment in Limassol (a well-known furniture chain), signed a sales contract using his name, and then asked the seller to change the contract with the same terms, but changed its name by adding an A to the end of his name. The buyer did not pay, and the seller sued. Five years later, the court decided that the original buyer was not the same as the second (company) with an additional A.Isn’t this a scam?
In the case of the Larnaca beach area, a group of buyers (10 out of 80) put forward all sorts of reasons why the General Expenses Administrator should leave. Eventually, he did, and the same group took over, resulting in an inability to collect the overall costs, and the project has now been closed. Other buyers got together and decided to sue the new administrative committee for the loss of value of their property. This is a very interesting case because it will help those who think they can do better.
In the Peyia project, the buyer claimed damages due to dampness in the walls of his apartment. We appeared as an expert witness, and on examination, a gardener who happened to be there told us that the British buyer was spinning water sprinklers on his wall (presumably to have a claim against the developer). He lost, but it took four years to decide.
In another case, in the Ayios Theodoros area of Paphos, a buyer from Russia claimed that an agent had sold him an apartment for more than its market value. He introduced the seller as an agent, who stated that the agreed sale price was the result of negotiations between the buyer and the seller, and the transaction was concluded behind closed doors. He lost, and now he has a “memo” on the apartment, which means that he cannot sell or dispose of the property unless he compensates the agents for lost time, costs, etc.
Electronic auctions are fraudulent in the sale procedure when important points are not disclosed to potential bidders. The apartment was handed over to the company as a 2-room apartment, and then it turned out that eight people live in it.
Non-payment of general expenses forced the administrative committee to cut off the water supply. However, since this is a shared service, hot water is still available for them (for now, other tenants pay for it). Currently, the administrative committee is pursuing a lawsuit against the owner. Now the remaining “good payers” must pay 3,000 euros each to the court in the hope of receiving contributions sometime in the future, in addition to the cost of a possible eviction.
I suggested that the government encourage investigative journalists to focus on these everyday crimes. Municipalities’ illegal actions and lack of transparency are a problem not only for the changes we need, but also because they do not respond to public letters.
I have written several times about how the municipality of Paralimni leased state land on the beach (converted into a restaurant). After five years of pressure, we are now being told that the municipality had no right to occupy or rent property at all.
An earlier court case involved seafront property in Neapolis, Limassol. The judge decided that because it was a public strip of land [20 feet wide], the property being valued was not considered beach land. The compensation received amounted to 250,000 euros. The owner appealed to the European Court of Justice, which awarded him 2 million euros in compensation. A case that still haunts any authority going through a forced acquisition process.
It’s time to create a common body made up of buyers, tenants, financiers and other stakeholders (including developers) that will act as a pressure group to improve the situation in the real estate sector with hope for a better future.
Antonis Luazou, real estate appraiser, real estate consultant and real estate agent
