Sunday, February 22, 2009

Curses! Foiled again

Beloved Wife and her Goat have been looking quite seriously for land in Cyprus for several months now. Yet each time, defeat is snatched away from the very jaws of victory.

On our most recent visit, one of the many places we looked at ticked most of the boxes. A level plot, easy access to a public road, definitely arable, not far from civilisation but private, not on recently levelled clay. There were issues, notably the nearest power being a mile away and water probably a similar distance.

Although initially advertised at way above our original budget, the agent said that there was room for negotiation, so we negotiated. The currency was actually Euro, but seeing as Cypriots seem to prefer to obfuscate financial matters by persisting with the obsolete Cyprus Pound, I’ve chosen to obfuscate further by adopting the entirely fictitious Ankh Morpork Dollar.

The first price, AM$ 80, was clearly ridiculous, and we said so.

Pointing out that it’d probably cost the thick end of AM$ 12 to get electricity to the site and a further AM$ 3 for potable water, we started to negotiate. There was also the matter that the owner was apparently desirous of disposing of the land as soon as possible, and we were standing there virtually with cash. That had to be worth more discount. And the first price had already dropped to AM$ 73.

We offered AM$ 59. This represents a 20% discount on the new asking price, but as land and property in Cyprus has plummeted by 41% over the first ten months of 2008,according to Aristo, in this article, we thought that our offer would not be unreasonable. For cash.

The agent called the owner on the phone, and eventually we closed on AM$ 60. That would give the vendor her target AM$ 58 clear, after paying taxes and agent commission. A little above our budget, but manageable. The agent already knew that our stated maximum budget was AM$ 58, so presumably the vendor would come down to a figure close to this otherwise what would the point have been in showing us the plot? We contacted our lawyer and handed over the letter from the vendor’s agent confirming AM$ 60 for a quick sale. Forty-eight hours later the money was with the lawyer. Not bad, considering that this was over a weekend.

And then the trouble started. The owner turned out to be the husband of the person named on the title deeds as part of some tax dodge, and he wanted AM$ 70. This was quite clearly prohibitive from our point of view, so we left the agent with the deadline of 20 February to accept our offer of AM$ 60 or to come up with a realistic counteroffer for our consideration. On 18 February, we were told that the vendor (the real one, not his wife) wanted AM$ 64, so we split the difference and said we could find AM$ 62.

The agent called us that evening. The vendor absolutely would not accept one gnat’s todger below AM$ 70 and there had never been an offer of AM$ 64. I suspect he spat his dummy out when we failed to come grovelling that would he please accept our AM$ 70. Well, I can also spit my dummy out, and take my ball home too, so I explained fully and frankly to the agent what the owner could do.

Remember, this is in a falling market. No-one is buying anything in Cyprus at the moment, mortgages are like hen’s teeth, so it’s not as if there’s another buyer lined up. I suspect that the landowner has been party to tall taverna tales, where various gentlemen lie to each other about how much they allegedly got for their fields.

I also suspect that the agent is a crook, who may be party to the conspiracy: “If these rich mugs from Dubai can magic AM$ 60 out of nowhere, they’ll be able to find another AM$ 10.”

What evidence for this alleged crookedness?

  • A previous plot advertised at 820sq.m remained at 820sq.m despite my calculations that it was 550sq.m. And now it’s advertised at 550sq.m. And not sold, by the way. Something about a 33% reduction in area and a zero reduction in price.

  • The current plot, advertised at 3300sq.m actually scales at around 2740sq.m on Google Earth.

  • Another plot we looked at was advertised at 2800sq.m, but turned out to be 1900sq.m. When queried, the agent acquiesced; we’d been shown the correct plot but it was the wrong advert.

  • While negotiating, the agent suggested that we bung EUR20,000 under the table as a tax dodge.

  • Several other agents described this one as a ‘crook’. Honour amongst thieves, eh?
One of these other crooks agents was responsible for the previous
deal that fell through
as a direct result of EUR turning into CYP as we went to the airport. On reflection, this was a probably a face-saving mechanism to get us to pull out of a deal that would have left the developer over a legal barrel if we behaved in the same underhand manner as he’d planned to do.

What are we going to do now? I’m tempted to wait until about June and then contact the agent again. I asked the readers to vote on the appropriate response.
    42% picked: “Has that field been sold yet? No? Our offer of AM$ 60 is now AM$ 55.” This one looks favourite, then.

    8% picked: “Is that field still for sale? Will he accept AM$ 60? Well that’s tough, ’cos we bought something else.”

    25% picked: “We’re fed up of your failure to play by your own rules, so bought land in a completely different country. Goodbye for ever.”

    25% picked: “I curse thee and thine offspring, yea even unto the seventh generation.”


EyeOnDubai said...

Where's the poll option that says "I now offer you AM$30?"


Anonymous said...

Hi Goat
Bad luck on the land deal, but I am afraid par for the course. We looked at about 30 pieces of land before finding (by accident) the one we bought. It is best if you can buy direct from an owner which we did in the end.

No doubt you have sussed out all the planning rules, particularly the one about direct frontage onto a registered road (doesn't have to be tarmac). Without this you can't build anything. Also worked out your permitted density.

We had no water so we took out an option to purchase the land while we drilled a well (cost £4k). A lesser gamble than just hoping. We also managed to get a village water pipe from the local official even though the WDD had said no.

We now have a superb 2 acre site and architects plans but can't go ahead because we keep getting gazundered on our UK sale.

Good luck.

Keefieboy said...

Those Ankh-Morpork dollars are great, aren't they?


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