International Property Journal - News and information on global property markets

Legislators in Cyprus adjourned for the summer without a solution to the island’s title deed controversy, which has helped spoil the island’s once fast-growing international property business.

Even with a recent uptick, property sales to foreigners on Cyprus are down by nearly 76 percent compared to 2008, and almost 84 percent from the peak in 2007, Cyprus Property News reports.

In a ruling with implications for thousands of second home owners, a U.K. court Tuesday ruled that a British couple must demolish their home in northern Cyprus and return the land to the original Greek Cypriot owners.

David and Linda Orams bought the property in 2002 and later testified that local estate agents assured them were no legal claims on the property. But last year a European Court of Justice decided the property must be returned to the original owner, Meletios Apostolides, who fled when Turkey invaded the north in 1974.

Tuesday a U.K. court of appeal upheld that ruling and ordered the Orams to demolish their home, return the land, and pay Apostolides damages and legal fees.

On Cyprus, once one of Europe’s second home hot spots, sales to foreign buyers dropped 84 percent in the last two years, new government data shows.

It’s a shocking turnaround for a market that was widely marketed throughout the United Kingdom, developing as an alternative to Spain. Sales peaked in 2007, when 11,281 homes were sold to non-Cypriots, according to filings with the Department of Lands and Surveys.

In 2009, there were only 1,761 units sold to foreign buyers, in the wake of a variety of scandals, Cyprus Property News reports.