Cyprus and Malta entering eurozone set to fuel property purchases

The European Union announced last week that Malta and Cyprus will adopt the Euro on the 1st January 2008 in another vote of confidence for the two island economies.

Currency specialists HiFX predict that the announcement will encourage further inward investment and spark increased interest in the islands’ properties from Brits attracted to the strong economy and local culture.

Having satisfied the EU's stringent economic management criteria, Malta and Cyprus have become the second and third of the EU's new entrants from 2004 to be allowed to adopt the Euro, beating the more heavyweight Lithuania and Slovakia to the tape. Whilst their respective currencies have been effectively fixed against the Euro for the past two years or more, the passage to the Euro confirms an economic maturity and the promise of a share in the spoils of the recently improved EU-wide growth story.

Many Brits have a soft spot for Cyprus and Malta. HiFX report that the number of Brits enquiring about buying in Cyprus and Malta has already doubled over the past year and prospective buyers will be no doubt be further encouraged by these developments.

Mark Bodega, Marketing Director of currency specialists HiFX comments: “We predict the property market on both islands to continue to grow due thanks to a number of reasons. British purchasers like the legal system in Cyprus as it is easy to understand-being based on the English one. The Cypriot government also believes in looking after the environment – properties cannot exceed a certain height, density is monitored and green areas are planted within developments.”

“Malta boasts far lower taxation than the UK and there are no annual council or property taxes and inheritance tax was abolished in 1992. Since joining the EU in 2004, the Maltese property market has shifted up a gear. As a result we are getting a substantial amount of enquiries from property investors seeking to purchase property to rent, and more discerning buyers looking for luxury properties and the excellent tax rates available to the higher tax payer”.