Cyprus-Forum.com

[jonah]

If my house is devalued by 40% caused by the financial crisis,will the cost of my title deeds be levy on the revised estimated cost

[johnny1]

no...they still want the money on what it was valued before the decrease.

[cyprusgrump]

Title deeds are charged one the contract price, not the value of the property...

[appel]

This is what I said in the "your banks are toast" thread:

You'll see massive asset price deflation, and lots of people will be "under water", meaning they owe more than they own. The banks that own mortgages will start to see lots of defaults, and collateral will be insufficient.

It will hit you guys real soon that a lot of people owe more than they own. This will result in increased number of bankruptcies, but even more the "will to pay" will decrease as people realize they are paying a debt that seems insurmountable. Also, going bankrupt will almost seem like a "way out". The banks will get a lot of homes into their "arms" very soon, as people cannot pay. House prices will plummet which further increases this problem.

[Oceanside50]

then the government should change the bankruptcy laws in Cyprus that instead of waiting 68 some odd years? for good standing maybe bringit down to 5years...

[Nikitas]

appel is drawing parallels with the US property market where prices can fall drastically. Cyprus and other places around the Mediterranean are different. Prices have dropped, some people have defaulted on mortgages, but the fall is unlikely to go below the land plus the property replacement value. As long as building material prices hold, the values have a low end limit belovw which they cannot fall. Nor do the people have the mobility of people in the USA where they up and move leaving mortgaged property behind to rot, as in Flint Michigan or Detroit.

Greece is a more likely parallel. Property prices fell by as much as 30 per cent. There are 300 000 new properties on the market, not much buying, but prices are not falling any furhter, because no one wants to sell for less than the cost of replacing a building.

[johnny1]

yeh but someone whos selling desperately.....

[appel]

"Cyprus is different".

You people are delusional if you believe this, it's denial. Cyprus is not different, it's the same as everyone else, bound to economic reality, just as we're all bound to gravity.

Things are going to get worse, much worse. Realize what's going to happen when unemployment rises to 30%, or 40%. You think nothing bad will happen? Things are going to get bad bad bad. This harsh reality is going to take a few months to materialize.

http://www.youtube.com/watch?feature=pl ... l_kKra8Fts

[Nikitas]

appel,

when I wrote that Cyprus is different I also explained the reasons, one of them being lack of labor mobility, which can rapidly depopulate an area as it does in the USA.

Property prices are falling and will fall further. Unemployment will rise, no doubt.

You forget that we faced a much worse situation in 1974, when the economy was deprived of 80 per cent of tourist accomodation, 60 per cent of mining production, 50 per cent of arable land. That experience was much worse than the situation today. It is still too early to say if now is going to be as bad as then, but the probabilities are that it will not be anywhere near like 1974. Judging from the situation here in Greece, there is a general slowing down in the economy, but not a total breakdown as you paint in your posts. Greece had a 17 per cet increase in exports in 2012 over the previous year, so not all things go to pot.

[Oceanside50]

"Cyprus is different".

You people are delusional if you believe this, it's denial. Cyprus is not different, it's the same as everyone else, bound to economic reality, just as we're all bound to gravity.

Things are going to get worse, much worse. Realize what's going to happen when unemployment rises to 30%, or 40%. You think nothing bad will happen? Things are going to get bad bad bad. This harsh reality is going to take a few months to materialize.

http://www.youtube.com/watch?feature=pl ... l_kKra8Fts

Actually Appel, Cyprus is different.

Facts:
Banks in Cyprus are broke
People/businesses most likely will not be able to get loans for economic expansion for many years 4/5 maybe.



Minimal foreign investment for just as long
Unemployment will certainly rise in the coming years
Tourism will bring into the economy hard overseas currency
Cypriots are entrepreneurial by instinct and hard working
Cyprus is a small country less then 800,000
Most of its citizens are not in dire debt: ie will not loose their housing, or go hungry



Most likely by the end of next year the Roc will be running a surplus..
With all their budget cuts..in a depressed economy the way one comes out of it is through Keynesian Econ theory..pump money into the economy in order to create demand..which creates jobs etc..The Eu hasn't applied that theorem yet and may not for a long time until things are fixed. Cyprus is unique from all other Eu members in that it has a second tier banking system with already existing institutions throughout the island, which have been used by it's citizens for close to
40 years,
these are the institutions set up by the government of Cyprus to help out refugees of the 74 invasion..with the certain upcoming surplus the government could begin making small loans to all it's citizens/small businesses through those institutions..which are not regulated by anyone except Cyprus.(the loans could be specific innature such as agriculture or for expansion of existing),..I'm not sure of the exact mechanisms for this but it certainly makes Cyprus very unique...