The Cyprus real estate market is flourishing, boasting a remarkable 21% increase
This year, there has been a notable surge in the demand for real estate, even in the face of escalating construction costs and upward shifts in interest rates. Data sourced from the land registry department relating to property sales agreements reveals that the real estate market is enjoying its most robust six-month period since 2008.
According to StatWatch figures, property sales agreements submitted to the land registry in the first half of 2023 reached 10,183, a substantial increase from the 8,453 recorded the previous year, marking a growth of 20.5%. This period stands out as the most favourable six-month stretch since 2008 when sales reached 11,088 units. In comparison to 2019, property sales have surged by an impressive 44.6%.
When comparing the figures to 2019, all cities have witnessed an uptick in property sales. Economist Tasos Yiassimides observed that Cyprus has successfully attracted a significant number of foreign companies, relocating part of their operations to the country through incentive programs. He noted, “The secondary real estate market appears to be going through one of its most prosperous periods, as the Land Registry Department statistics indicate a notable increase in property transactions.”
Yiassimides highlighted that the demand is primarily fuelled by foreign buyers from neighbouring countries and Cypriot residents. Additionally, a significant portion of this demand originates from companies moving part of their operations to Cyprus.
He further pointed out that the escalating construction costs in the real estate sector have seen a significant rise, potentially restricting the number of new developments, especially those affordable to the middle class. Moreover, the increase in interest rates presents a challenge for land development companies and individuals seeking housing, potentially making borrowing less viable.
The Central Bank, in its release of housing price indices, reported that, up to the first quarter of 2023, the increase in the ECB’s key interest rates and the resulting decrease in demand for housing loans do not appear to have significantly impacted the domestic demand for properties, which continues to rise.
As for August 2023, property sales agreements filed reached 1,132, compared to 972 in August 2022, indicating a 16% increase. In July, there was a 12% uptick.
In 2022, the total number of property sales agreements filed amounted to 13,409 units, compared to 10,347 in 2021, marking an annual increase of 29.6%.