Trapped buyers

Cyprus trapped buyer case exposes deep property & legal failures

By Nigel Howarth- December 2, 2025

Cyprus' trapped buyer crisis persists as faulty laws and developer debts continue to leave purchasers at risk.

A recent letter published in the Cyprus Mail by Mr Helmuth Porschen, entitled “Paying the price of a developer’s mortgage“, has once again thrown a harsh spotlight on the ongoing scandal of trapped buyers in Cyprus.

Mr Porschen’s question is simple, yet devastating: How can Kedipes threaten to auction his wife’s home over debts owed not by them, but by their property developer?

Unfortunately, his plight is far from unique. Mr Porschen is just one of thousands of innocent purchasers ensnared in a system that has failed them at every turn.

In his case, he is trapped not only by his developer’s unpaid mortgage but also by an incomplete development. Legally, the situation is brutally clear: the bank holds a superior claim because the developer’s mortgage was filed at the Land Registry before Mr Porschen’s contract of sale.

This is an all too familiar and tragic pattern – buyers are left exposed due to developers hiding existing mortgages, buyers receiving poor legal advice, or inadequate due diligence during the purchase process.

Kedipes, the state-owned credit-acquiring company, is one of several entities commonly known as “vulture funds” – organisations that swoop in to extract maximum value from distressed loans, with zero regard for their defenceless human victims.

Possible solutions

Trapped buyer law amendment may help

A recent amendment to the law may, however, offer Mr Porschen a lifeline. A trapped buyer can now request written consent from the party holding the charge – in this case Kepides – to have it lifted or cancelled. Should that consent be withheld without solid justification and the buyer has paid in full, a court order can be pursued to override the refusal.

But here lies yet another grim truth: at Mr Porschen’s age – late seventies – a court battle could take years. If Kedipes refuses to release the charge voluntarily, he could be trapped in legal limbo for the remainder of his life.

Sue his lawyer?

There is, however, another avenue. If his lawyer failed to warn him that the property was already mortgaged when he bought, Mr Porschen may sue for professional negligence. A landmark Supreme Court ruling fifteen years ago ordered a lawyer to pay €120,000 in compensation to clients who suffered losses after being misled over a developer’s unpaid mortgage. The circumstances appear strikingly similar, and Mr Porschen may well have strong grounds for a claim – though again, justice may be years away in the slow-moving Cypriot courts.

Planning violations – the victims have to pay

The issue of the incomplete development is yet another legal quagmire awaiting reform. Under current legislation, if a planning application for, say, 50 houses is approved and the developer builds only 49, none of the completed homes can receive Title Deeds. This bureaucratic absurdity leaves entire communities in limbo, with developers facing no real accountability for failing to complete projects or for committing planning infringements. Why, yet again, must the burden fall on innocent buyers?

For now, Mr Porschen’s best hope is to find competent legal representation. By his own account, his current lawyer “seems not to have any interest in this case and has done nothing so far.” With his home and peace of mind at stake, decisive action is urgently needed.

His story is a stark reminder that Cyprus’ trapped buyer crisis is far from over and continues to extract an unforgivable human cost.

(The UK Foreign, Commonwealth & Development Office (FCDO) publishes a list of English-speaking lawyers who may be able to assist Mr Porschen and others. See Lawyers in Cyprus

Source Cyprus Property News