Cyprus-Forum.com

[miltiades]

Take a tour in Limassol and you will see how may unfinished developments. Developers have run out of dosh, Russians ain't bying. Have a look on facebook and see the crazy prices asked for high end projects.

[Paphitis]

Take a tour in Limassol and you will see how may unfinished developments. Developers have run out of dosh, Russians ain't bying. Have a look on facebook and see the crazy prices asked for high end projects.

It's all subjective.

Those prices are not that high when there are apartments in Manhatten selling for 30 million. That's what you call high.

And usually these properties are whipped up in 24 hours even because America is not short of people who can afford them.

If developers in Cyprus have run out of dosh, then they are amateurs. You don't just run out of dosh. Developers usually finance their projects and have secured their development to final fix.

[miltiades]

Cyprus isn't Manhattan. The lowest monthly pay recently announced is a ...thumping 950 euros. Developers were developing not for the local market but exclusively for the Russian billionaires. Recently a 3 bed appartment in the Limassol Marina was offered for rent at the " dirt cheap" monthly rent of ....30 thousand euros The so called " luxury" market will collapse by the end of this year. Banks are closing branches right left and centre, it certainly doesn't look goid for the Cypriot economy who most had all its eggs in the Russian basket.

[Maximus]

Take a tour in Limassol and you will see how may unfinished developments. Developers have run out of dosh, Russians ain't bying. Have a look on facebook and see the crazy prices asked for high end projects.

If developers in Cyprus have run out of dosh, then they are amateurs. You don't just run out of dosh. Developers usually finance their projects and have secured their development to final fix.

Exactly Paphitis,

what stupid developer would start a project without the finance already secured to see it through to the end? They would only use all of that in a worse case scenario that they dont sell a single thing. With that said, in the end its actually the buyers that is financing the development. Then there is the question of the lender or the bank, banks generally wont finance a project unless it can be seen through to the end so they can secure the loan.

What Milti is seeing are new developments "starting", its just his opinion that they have stopped because they have run out of dosh.

Property sales up 39% in first half of 2022, compared to same period last year.

[Get Real!]

Exactly Paphitis,

what stupid developer would start a project without the finance already secured to see it through to the end?

Calculating the correct amount to be secured is the tricky part, especially for large and complex projects that need a number of years to be completed.

Miscalculations and/or unforeseen events like the current disasters the West has imposed on itself, can ruin many projects each year worldwide.

There must be thousands of stalled projects in Europe right now, thanks to our geniuses in Brussels.

[Paphitis]

Exactly Paphitis,

what stupid developer would start a project without the finance already secured to see it through to the end?

Calculating the correct amount to be secured is the tricky part, especially for large and complex projects that need a number of years to be completed.

Miscalculations and/or unforeseen events like the current disasters the West has imposed on itself, can ruin many projects each year worldwide.

There must be thousands of stalled projects in Europe right now, thanks to our geniuses in Brussels.

That's why you have quantity surveyors. They can gauge your costs to within 2 to 3%. And developers will allow for any margin of error.

They will also allow for any variations. A Bank doesn't usually say they approve up to a certain amount when it comes to a development. They will bank roll to completion.

Even if the developer becomes insolvent. Banks will complete because if they don't, they know they won't get all their money.

The constructions that have probably stopped are probably construction from owner builders and other amateurs and families, who don't know what they are doing.

[Maximus]

This is the thing though, developments dont necessarily stop, they pause!

Here's why.

Developers front load the payment schedule and bring the development up to a certain point. Where they can take as much money from the buyer as quickly as possible. Then they go and start something else to do the same thing.

When they have two or three developments on the go, or whatever their capabilities can handle, they come back to the original development to finish it off.

Towards the end of a development, the developer gets less and less of the buyers payments because much of that goes to buying the tiles, the kitchen, bathroom stuff, windows, etc. The bulk of these payments usually go to their suppliers.

[Get Real!]

Come on fellas… I’ve seen lots of projects fall apart and the parties involved going to courts… in fact that’s exactly what happened to the Nicosia “square”; a project which commenced way back when Eleni Mavrou came to power and didn’t finish until last year!

I’ve lost count how many project managers and development companies had come and gone over the years before the damn thing finally finished at 10 times the initial budget!

Yesterday I was downtown because I had some things to do and my wife asked… “Shall we go down and walk through the square?” so I took a look over the wall and said… “No thanks, it sucks!”
That’s how bad it is!

[Maximus]

No one is saying that development projects dont go tits up.

You are citing a high profile project that had media coverage, so you know the score. It still got completed though!

In Milti case, he drives by and sees a concrete skeleton without people on site and he thinks its an indicator of a property crash and the developer has run out of dosh.

Big difference.

What I said in the post above is quite common practice with small to medium sized developers looking to maximize their income. They might have gone to start something else, they might be finishing something somewhere else, they might be waiting for an outsourced supplier to do some work, milti drives by after 7pm when no one is working, there could be any number of reasons why things are progressing slow or it seems that it isnt progressing at all...

[miltiades]

Do you think that the apparent absence of Russian byers is having some affect? The high end market is exclusively aimed at Russian multi millionaires .Limassol is saturated with such developments. There is in Mobiles a huge unfinished office block. No sign of any work for over 3 months. It's called ...WALL STREET. Prices were entirely aimed at Russian companies. They ain't coming.
The crush is coming though.