Electronic auctions are reshaping property sales in Cyprus, with 36% of published auctions currently suspended due to agreements between borrowers and lenders, according to the Cyprus Banking Association. This shift to an online auction system represents a significant change in how properties are sold in the country.
Electronic auctions: Launch and Management of the E-Auction System
The electronic auction platform is managed by ACB E-Auctions Ltd, a subsidiary of the Cyprus Banking Association established in 2019. It operates under a strict legal framework defined by the Finance Ministry’s 2019 order, which governs the sale of mortgaged properties through an automated system, eliminating the need for human intervention.
Exclusive Online Auctions Since 2022
Following the discontinuation of physical auctions in 2022, all property auctions are now conducted online. The Cyprus Banking Association reported that the e-auction system has around 10,000 registered users from both Cyprus and abroad, with operations commencing on November 18, 2019.
Regulatory Framework and Participant Rights
The legal framework ensures that each auction process is transparent and fair, with a requirement for public notification 45 days before an auction. This information is published on the Interior Ministry website, in two widely circulated newspapers, and on the ACB E-Auctions platform. Notably, mortgaged borrowers have the right to observe the auction, provided they register on the system.
Preferential Rights for Borrowers
When properties valued at up to €350,000 are involved, borrowers and their first-degree relatives have a preferential right to purchase the home at the final auction price. This measure aims to protect borrowers and increase their chances of retaining their primary residences.
How the Electronic Auction Process Works
Interested parties can register on the e-auction platform free of charge. They select their desired auction and must submit a guarantee amount between one to five working days prior to the auction date. On auction day, participants log in to place their bids, with real-time updates on current prices and their ranking.
Successful Bids and Next Steps
If a participant successfully wins the auction, they receive an email notification with further instructions. The guarantee amount is then transferred to the mortgage lender, and the successful bidder must contact the lender to complete the transaction. In the event of an unsuccessful bid, the guarantee amount is refunded according to the payment method used.
Advantages of the Electronic Auction System
The move to electronic auctions offers several advantages, including enhanced accessibility. Participants can take part from anywhere with internet access, using a computer, phone, or tablet. The platform guarantees anonymity for bidders and is user-friendly, available in both Greek and English.
Increased Participation and Higher Sale Prices
Notably, the dynamic of the auctions is designed to benefit mortgaged borrowers by encouraging increased bidder participation. The highest interest recorded in a single auction saw 25 participants, demonstrating the competitive nature of the process, which can lead to higher final sale prices.
Transparency and Security in the Auction Process
The electronic auction process is described as incorruptible and transparent, with full automation ensuring that human interference is eliminated. This change has also addressed issues of intimidation that were previously present in physical auctions, creating a fair environment for all participants.
Future Plans and Community Engagement
The Cyprus Banking Association continues to focus on transparency and community engagement. They aim to strengthen cooperation with media professionals to disseminate accurate and objective information regarding the financial sector and its impact on the Cypriot economy. Similar initiatives are planned for other topics in 2026, further emphasising the association’s commitment to public awareness and education.
A Commitment to Continuous Improvement
During a recent press conference, the association highlighted the success of the e-auction initiative and discussed future plans to enhance the system further. An extensive dialogue with journalists reinforced a shared commitment to transparency and the importance of ongoing communication with the public.
