Property valuation in Cyprus
A property valuation in Cyprus is normally carried out by a valuer registered with the Cyprus Scientific and Technical Chamber (ETEK). The valuer works out the market value of the property and sets it out in a written report, the kind of report banks and insurers use.
DevelopersCyprus is a licensed estate agency, not a valuation practice. We do not issue valuation reports for banks. What we do, free of charge, is tell you what your property will sell for, and we have been doing it in Cyprus since 1982.
Property valuation report
In Cyprus, a property valuation report is normally prepared by a valuer registered with the Cyprus Scientific and Technical Chamber (ETEK). ETEK is a public-law body set up by Law 224/1990. Land valuation is one of the branches of engineering science that law lists, and ETEK keeps a register of members for each branch.
As a rule, only a person registered with ETEK in the land valuation branch, with an annual ETEK licence to practise and the knowledge of Greek needed to practise in Cyprus, may work as a valuer. The law makes exceptions, under conditions it sets: for example, a person in the Cyprus public service may value land for the duties of the post.
Registration and the valuers' association
Registration needs, among other conditions, a university degree or diploma, or another equivalent qualification, in that branch. The qualification must allow the holder to practise the profession in the country where it was awarded, and ETEK must recognise it. A valuer can join the Cyprus Valuers Association (ΣΕΕΑΚ or CVA), whose minimum condition for membership is registration with ETEK in the land valuation branch.
The CVA has been a member of TEGOVA, the European Group of Valuers' Associations, since April 2017 and is a full member. TEGOVA took its current form in June 1997, from the former EUROVAL. It drafts and promotes the European Valuation Standards (EVS) for adoption across Europe.
What should be included in a property valuation report?
The report states the market value of the property.
It usually describes the location and address, the land and its size, the construction and the condition of the building, the planning zone and the insurable value. It may mention the title deeds and anything that adds value to the property.
Relevant documents, such as the cadastral plan, are attached to the report.
What we can do for you
Start with the question we will ask you first: what do you need the figure for?
If a bank, a lender, an insurer, or a court has requested it, you need a formal valuation report from a registered valuer. We do not produce those. Contact us, and we will put you in touch with a valuer who does.
If the figure is for you, because you are deciding what to ask, or whether to accept what you have been offered, that is our work. We will tell you what your property will realistically sell for in today's market, and why. Antonis Michael, who heads this side of the business, is registered with ETEK in the land valuation branch, so the number you get is not a guess.
What the advice covers:
- A conversation about what you want out of the property and when
- A visit to see it
- What comparable properties have actually sold for nearby, not what they were listed at
- A selling price we will stand behind, with the reasoning laid out
There is no charge and no obligation. If you decide to sell, we would like to handle the sale.
Want to know what your property will sell for?
Our ETEK-registered valuer, Antonis, is ready to help you.
Cyprus real estate valuations: procedures and methods
Typically, a real estate valuation will take into account:
- the wider market, such as interest rates and inflation
- the property and the building, from their location to their condition
The valuer visits the property and researches the market, including the prices of comparable properties.
Commercial real estate valuation
Commercial real estate valuation works out the value of property used for business. The income such a property earns often weighs heavily in its value.
Commercial property includes, for example:
- Offices
- Shops
- Warehouses and industrial buildings
- Hotels
Valuers use the same main approaches, listed below, for commercial and residential property. Some suit one type of property better than the other, so the valuer chooses the approach case by case.
The main valuation approaches are:
- Cost approach. The valuer works out the cost of the building, taking account of its age, size, condition and features, and adds the value of the land, estimated from sales of similar properties in the area.
- Sales comparison approach. Sometimes called the "market approach", it estimates the value from recently sold properties in the same area. The valuer adjusts the figure for differences such as age, size, condition and improvements.
- Income approach. Sometimes called "income capitalisation", it estimates the value from the income the property earns.
Property appraisal vs valuation: is there a difference?
A property appraisal is an informal estimate, usually given by a real estate agent as a guide to pricing. A property valuation is a formal written report by a valuer registered with ETEK, the kind of report banks and insurance companies use.
Real estate agents usually give appraisals free of charge. Notwithstanding any other law, a licensed estate agent who acts as intermediary in a property transaction may give an opinion on the value of that transaction when the seller or the buyer asks. A valuer charges a fee for a detailed, objective valuation.
Neighbourhood assessment
The neighbourhood affects a property's value, so a valuer looks at it when preparing the report. The valuer inspects the area and collects data.
A neighbourhood analysis in a valuation report usually covers:
- Boundaries: the legally recognised neighbourhood and municipal boundaries, and the streets that mark out the area.
- Buildings: the types of structures and the architectural styles.
- Land use and layout: the current land use (residential or commercial, for example), the street pattern and typical plot sizes.
- Location: how close the area is to jobs and amenities, access to public transport, and environmental influences.
Other factors a valuer may look at:
- Noise and pollution.
- Social considerations like demographics, income levels of residents, harmony, and growth trends.
- Political and government factors like taxes, planning, zoning requirements, building codes, and restrictions.
- The surroundings and views.
- School areas.
- Safety and crime.
- The quality of utilities.
- Distance from shopping centres.
- Are the other buildings and homes in the neighbourhood maintained well?
- Is the community improving, stable or declining?
Things that can affect a home's value
Various factors affect a home's value, from age and maintenance to decoration.
- The neighbourhood is one of the biggest influences on a home's value.
- So is location: proximity to employment and jobs, schools, shopping, entertainment, child-care and other amenities. Waterfront properties are usually the most sought-after.
- The size and appeal of the house matter: the amount of livable space, beds and bathrooms.
- Age and condition: newer homes and well-maintained older homes sell for more. Condition is critical, referring to foundations and structure, electrical work, plumbing, the roof, appliances, and other functional issues. The cosmetic appeal of the house counts too.
- The national and local state of the market, from interest rates and government regulations to the number of properties for sale in your area and the number of buyers.
Factors that negatively affect a home's value include traffic (living near busy roads), noise and pollution, high area crime rates, poor maintenance, damage, the home being built on a flood plain, illegal extensions and/or improvements without permission, and over-decorating that reduces the house's aesthetic appeal.
Reasons why you need to have a property valuation
A property valuation is useful for several purposes:
- You can sell the property at an appropriate price or charge accurate rent.
- Insurance, financing, mortgage ("loan justification") and other legal or finance matters.
- Investing.
- Dispute resolution and other legal matters, such as dividing the property upon divorce.
- Inheritance issues.
- If you seek to rent as a tenant, you will know if the landlord is asking for a reasonable rent for the property.
Online property valuation
An online property valuation in Cyprus gives a general estimate from data. It is not a valuation by a valuer registered with ETEK, so it is less precise and carries less weight than a valuer's report. It is useful as a first check.
Automatic valuation tools produce unofficial estimates, much like the free appraisals Cyprus real estate agents give.
Valuation fees
In Cyprus, the Cyprus Valuers Association (CVA) publishes indicative fees, set by the value of the property, so that clients know what valuation offices whose directors are members of the association charge. The minimum suggested fee is €300 for a property valued at up to €250,000, and €300 plus 0.1% of the value above €250,000 for a property valued at €250,001 to €1,000,000. VAT is added to these fees.
You can see the full list of indicative fees on the Cyprus Valuers Association website.