To rent or to buy? Holiday villas in Paphos Cyprus  

by Pool Builders on 07-26-2011 in Articles

Every year, thousands of Europeans consider buying a property on the island of Cyprus, eager to enjoy the 300+ days of sunshine and laid-back lifestyle. It's all too easy to be lured by glossy brochures and slick sales presentations, but if your dream is a place in the Cyprus sunshine, ask yourself just one question - how much is 10% of the asking price?

Why 10%? According to the latest figures from the Royal Institute of Chartered Surveyors (RICS)*, from March 2010 to March 2011, Cyprus property prices dropped by 10.7% for houses. Sadly, in the wake of Greek economic situation, the trend is still downwards; Paphos apartments lost on average 4.7% of their value in the first quarter of 2011 alone.

Back to that 10% drop. Let's say you bought a 3 bedroom holiday villa a year ago in a nice development near Paphos for Euro300,000. 10% of the asking price is Euro30,000. If you sold the villa now, one year on, your annual holidays in Cyprus would have cost you Euro30,000. Ouch!

Factor in the costs of ownership, including security, fixture and fitting, property management fees, mortgage or loan repayments, swimming pool cleaning and rental agent commission, etc, and the figures just don't add up. Plus, you'll have to pay tax on any rental income in the UK, and the allowances for holiday homes have been drastically reduced over the last 3 years.

Compare that to renting a holiday villa in Paphos instead. For example, renting the Villa Sofia near Paphos from costs Euro930 during high season. That's less than Euro1000 per week, so you could have lived at the Villa Sofia for 6 months at the top season rates, and still pay less than you've lost in the value of the purchased villa.

Even if you stuck that Euro300,00 in a savings account paying a measly 1% per annum, you'd be much better off, with Euro3000 to spend on your Cyprus villa holidays every year. Avoid high season and your money goes even further, with cheaper rental rates on both villas and hire cars, plus cheaper flight options too.

The other main advantage of renting a holiday villa in Paphos rather than buying is the convenience; you arrive to a spotlessly clean villa and (sometimes) a stocked fridge. All you have to do is unpack, relax by the pool and enjoy yourself. No DIY jobs, no furniture to replace or walls to repaint, and at the end of your stay, you simply lock the door behind you.

By renting your holiday villa, you can also experience a range of locations, so if you fancy the mountains in spring, or a hilltop location in autumn, you can choose a villa to suit, rather than being based in the same location year after year.

Also, consider this: many holiday villa owners have to rent out their villas during the peak season to cover costs, so their own lovely holiday villa is not available for them to enjoy for the summer because it's rented out.

So, next time you are tempted by glossy photos in an estate agent's window in Paphos, or a For Sale sign on a gorgeous holiday villa, remember that 10%, and just how much rental villa luxury it can buy you without the hassle of ownership.

* RICS Cyprus Property Price Index

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