Building a house is an investment decision, which should be studied carefully, as most families built a house once in their lifetime and the final decision in most cases can be irreversible. Below are some general guidelines, which could help the owner to assess the cost of building a house, since small items, which could build up the cost of the house, are usually ignored.

Prior to the commencement of construction of your own home, at least the plot should be, or nearly be paid. This will certainly give you an advantage with the financing of the building cost for the house and it is a prerequisite for all financiers. For the transfer of ownership of the plot a Governmental transfer fee of 7%-8% (on average) is required on the market value (not necessarily what you paid for) of the plot.

To register a mortgage, a fee will be paid to the Land Registry Office of about 1% on the Mortgage amount. Normally the mortgage amount is the actual loan %2B 20% on top. You will have to pay the stamp duties and other Bank expenses, which could take the form of once and for all Bank charge (say, on average CYP1000). If you borrow from a bank there is an additional charge of approximately 1.5%-2.0% p.a. on top of the legal base rate of 4.5%. There are now many alternative housing schemes including Life Insurance finance, Co-Op financing etc which extend for 25-40 years and own contribution approximately 20% (usually through term life insurance).

It is imperative to use a qualified Architectural Office which will have the responsibility for the work done. You should not compromise on this, since the Architect is the most important person in the whole process of building your house. Yes, go to different offices and do discuss fee levels and then make your decision, but always use a qualified architect. Rates are normally around 5% on the total cost of the building and includes the design and supervision. Some architects go up to around 6%-8%.

You will also need to employ a Civil Engineer to carry out the structural design. This cost, with supervision is approximately 1% on the cost of the building.

The cost of the building referred to, includes all items, but not the fees paid to the Authorities and decorative items. So please clear the matter with the Architect, Engineer, etc., what is included is the total building cost.

The Town Planning Department charges for the issue of the licence will cost you around £300 and for the building licence an added amount of £150-£200.

If you wish to engage a Quantity Surveyor for the building, a fee of 1% of the total building cost is required. The cost for a mechanical engineer (for large buildings) is approximately 3%-5% on the cost of the Electrical and Mechanical Budget. Although the use of the above is optional, it is recommended for large and complicated buildings.

Below you will find a guide of the building costs:

Normal quality house

* CYP500 per sq. meter for the covered area
* CYP150 per sq. meter for the uncovered veranda
* CYP250 per sq. meter for the basement

Good quality house

* CYP550-CYP650 per sq. meter for covered area (depending on quality/facilities)
* CYP180 per sq. meter for uncovered area

Plus the cost of a garage (£3000), water borehole (£1500), fencing and garden (£3500-£4500) for normal plots sizes.

Extra costs have to be paid for connection to the Water Board, Electricity, Telephone and Land registry Office (demarcation, issue of title etc) estimated at about £1000 in total.

-Total cost/sq.m. for a (250 sq.m.) house
-House 250 sq.m. @ £550/sq.m. £138.500
-Fees and Licences £9.000
-Interest on Loan (say) £6.000
-Other Authorities £1.500
-Garden etc. £3.000
-Sundry other expenses £4.000
-Total cost £162.000 or (£745/sq.m.)
-on top add 15% V.A.T.

The purchase of equipment and installation cost of central heating is an addition and costs approximately £20/sq.m. and for the airconditioning system, an additional amount of approximately £40/sq.m.

A large number of people act as their own contractors for the building and subcontract all the various jobs and supplies of the work. Where the owner is able and with sufficient knowledge and has the time to carry out the supply and coordinating function, there could be a possible saving of 8-10% on total cost. Going further, if “weekend housing” is put into effect (whereby all the family and friends offer themselves as labourers, skilled and unskilled) then the cost can be reduced by 12%-15%. Obviously, in both cases there is the strong danger that the quality will suffer and the time of completion extended.

In recent years, with the introduction of VAT and the increase in labour costs, we have experienced an increase of 7-10% per year, in building cost, a level which is higher than inflation. This has made the building of a house that much more difficult. A house can take approximately 18 months to be completed.

A last item that can cost between 5%-8% in addition, is the right of the Contractor to ask for increase in labour costs and materials prices during the period of construction. Therefore a certain amount for unforeseen costs should be included in the final costing.

Unfortunately in Cyprus we have not reached any stage of prefabrication, whereby sections of the house, windows, doors, kitchens, etc., are prefabricated so that there is a reduction in costs. Also the shortage of skilled labour has created a certain indifference to the quality produced and should always be watched.

The problems related to the building of a house and the related delays have caused the market to direct its interest towards ready houses (a circumstance which did not exist 7-9 years ago). We expect this trend to continue with a positive effect on the value of ready homes.

Larnaca is located on the southeastern coast of the Republic of Cyprus. Larnaca in Cyprus could be described as the resort with everything. It is home to the island’s largest international airport and  boast a great selection of shops too. There are also several modern industrial estates on edges of the district and a thriving commercial center too. There’s a modern promenade thronged with trendy sea front cafe bars, restaurants and the obligatory fast food chains for the youngsters.This makes it a natural tourist destination, as well as a starting point for visitors who want to explore other parts of the island.

The beach at Larnaca is one of the best in Cyprus and is actually man made though you wouldn’t have guessed so. Most of the restaurants and cafes run opposite the beach making them the ideal place to relax whilst taking in the superb view. It’s a nice stroll from Larnaca marina at one end to the ancient medieval fort at the other. Across the road from the marina is a small public gallery and a beautiful paved area built around an ornamental fountain. Some of the buildings in Larnaca are centuries old and many of them have been painstakingly restored to their former glory. A short walk to some of the quaint back streets behind the main promenade will reveal many more that are still awaiting renovation.

The history of Larnaca stretches back further than any other part of Cyprus and the town has been continually occupied since the bronze age. The town is built on the ancient site of Kition which was in fact once the capital of the whole of Cyprus. Legend has it that the original city of Kition was founded by the grandson of Noah and the biblical connections don’t end there. The church of saint Lazarus in Larnaca square is actually named after the same Lazarus that Jesus raised from the dead. The legends say that after his resurrection Lazarus traveled to Cyprus where he became the Islands first Bishop. The church is actually reputed to have been built over his tomb and visitors can go down into the tombs below the building. Like most of the churches in Cyprus Larnaca church is beautifully adorned with icons and intricate decor.

Ideally situated only a few kilometers from the airport the town has become a thriving vibrant community. In 1974 following the Turkish invasion and subsequent occupation of the North of Cyprus Larnaca offered to accept 40,000 refugees. These displaced persons tripled her population to a then 65,000 inhabitants. With great motorway links to all the coastal resorts and the capital Nicosia the town is perfectly located for those wishing to visit the Islands many places of interest. With the recent boom in holiday home purchases Larnaca has also become something of a property hotspot. The fringe coastal villages such as Oroklini make ideal settings in which to own an apartment or villa and the prices are still quite reasonable compared with other parts of Cyprus. In fact many locals are selling up and buying villas in such places due to their out of town exclusivity which in turn is creating some prime locations.

With so much going for Larnaca it is no surprise that it is earmarked by many to be the next Cyprus property boom area. With this in mind many speculators are investing in off plan purchases on these new developments. They plan to profit from the rising market by selling when the developments are completed. The speculation is being further fueled by the proposals of a larger modern marina for the berthing of luxury yachts and a possible golf development. Golf sun and property are part of any speculators mantra so this is bound to affect values. If the area didn’t have more than enough to offer already these new proposals could turn it into an investors dream come true. So maybe if you are looking to invest in a place in the sun you should take a look at Larnaca Cyprus.

Larnaca is the second city, after the capital, Nicosia. Larnaca is an important commercial port and tourist resort. Larnaca, like the whole of Cyprus enjoys a Mediterranean climate benefiting from long, dry, sunny summers and very mild winters making it an excellent destination for tourists. There are many reasons for visiting Larnaca, and Cyprus, there has never been a better time to go. Why not consider a holiday home, investment property in Larnaca.