Swapping a house for an apartment

The question of whether to swap a house for an apartment comes up quite regularly for homeowners who have reached a certain age.

Circumstances change. Children grow up and leave home, older people are not as active as they used to be and finances are not as healthy as were when their house was built or purchased.

When investing in a house for a family with children, the garden is of a paramount importance. More space is required for children to have their own bedrooms as they get older and so on.

But as the children leave home and the owners get older, cleaning becomes a problem. This is particularly so for the homes with multiple levels, which become inconvenient if there is no lift. The financial upkeep also puts a strain on some retirees.

So, it is not a surprise that there are many homeowners past the age of 60-65 that look for apartments, which are more practical and less costly to live in. Location also becomes very important in terms of convenience and shorter travel times. Apartments with two to three bedrooms, which are located within or close to a town centre, are quite sought after.

A house of around 300 square metres is worth on average €700.000 when in good condition and around 30 years old. An apartment with an extent of 200 square metres is around €400.000, excluding transfer fees, VAT and other transfer costs. In terms of maintenance a house will cost an average of €400 a month for maintenance, garden and any workers needed for upkeep, whereas for an apartment, the common expenses, sinking fund, maintenance and so on will come to around €150 a month.

There are deterrents however, such as the bad management committee of apartment buildings, with problems such as some people not paying common expenses, and the lack of respect for privacy that can be a problem in Cyprus. Then there is the possibility of having to pay capital gains tax and transfer fees and so on.

It is also very difficult for homeowners to psychologically accept the move from a house to an apartment after many years of living in a house.

I wish I could come up with a straight-forward answer, but each case depends on the personal circumstances of the owners. What I can say is to have in mind that age will catch up with you and at least some of the psychological and physical problems could be addressed by planning ahead.

Antonis Loizou & Associates EPE – Real Estate Appraisers & Development Project Managers, www.aloizou.com.cy, antonis.loizou@aloizou.com.cy