11.01.2024
Residential property prices in Cyprus continue to rise in the third quarter of 2023, especially in the apartment segment. Data from the Central Bank of Cyprus (CBC) indicates an increase in the Residential Property Price Index (RPPI) both year-on-year and quarter-on-quarter compared to previous periods. It is important to note that the volume of real estate transactions in the third quarter of 2023 also increased compared to the same period the previous year.
Increased demand for real estate is being driven by both domestic buyers, including those considering rental investments, and foreign investors, especially in light of headquarter policies and other forms of investment. However, construction activity on the island decreased between January and August 2023, compared to the same period in 2022. This trend may be due to increased construction costs and borrowing costs.
Overall RPPI growth in the third quarter of 2023 was 2.2%, significantly higher than the previous quarter (1.5%). This growth is explained by an increase in prices for residential real estate by 1.4% and, in particular, prices for apartments by 3.6%. On an annualized basis, property prices increased 7.6% in the third quarter of 2023, up from 7.4% in the second quarter of the same year. Particularly high growth was noted in the apartment segment, where prices increased by 11.5%, and prices for residential real estate – by 4.9%.
At the regional level, increases in residential property prices were recorded across all areas of the island in the third quarter of 2023. Limassol leads the way with an increase of 2.9%, followed by Larnaca (2.8%), Paphos (2.4%), and Famagusta (2.8%). Compared to the previous year, all areas also saw an increase in residential property prices, with Limassol showing the highest increase of 10.1%.
Residential property and apartment prices also showed growth, both quarterly and year-on-year, highlighting the stable trend in the Cyprus property market.
Residential property price indices are compiled with the participation of the Central Bank of Cyprus (CBC) and member banks of the Association of Cyprus Banks. The data used to calculate the indices has been collected since 2006 and represents real estate valuation information collected by contract banks from independent real estate appraisers as part of their mortgage transactions. This data covers all territories of the Republic of Cyprus and concerns both houses and apartments.
On a quarterly basis, housing prices increased in all areas. Nicosia recorded an increase of 0.3%, while Limassol , Larnaca , Paphos and Famagusta recorded increases of 1.4%, 2.5%, 1.1% and 4.3% respectively. Year-on-year house prices also increased in all areas, with prices in Nicosia, Limassol , Larnaca , Paphos and Famagusta rising by 3.8%, 5.1%, 8.3%, 3.1% and 9.5% respectively .
On a quarterly basis, apartment prices increased in all areas, with the exception of Famagusta , where they fell by 1.7%. Nicosia recorded an increase of 1.5%, Limassol – 4.0%, Larnaca – 2.9% and Paphos – 5.2%. Annual growth was recorded in all districts, with the exception of Famagusta , where they decreased by 1.8%. Nicosia, Limassol , Larnaca and Paphos recorded increases of 4.6%, 4.9%, 13.4% and 18.5 % respectively compared to the same quarter in 2022.
