The residential property market in Cyprus is showing stability despite some signs of stagnation. According to analysts, growing demand, especially from foreign buyers, continues to push up the cost of residential property, making it unaffordable for many locals. At the same time, rents are also rising.
Structural challenges of the market
President of the Cyprus Council of Registration of Estate Agents, Marinos Kineriou noted that despite the stability of the market, unresolved structural issues could trigger further price increases. In particular, delays in issuing building permits remain a significant obstacle to increasing the supply of residential real estate.
Polis Kourousides , head of the Association of Property Appraisers, stressed that foreign buyers now make up half of the market. This high level of demand is putting pressure on the market, which could continue in the coming years.
According to the Land Department data for the first nine months of 2024, the total volume of transactions and their value decreased, but the number of registered documents for the purchase and sale of real estate increased.
Increases in transactions in Nicosia and Larnaca partly offset declines in Paphos and Limassol . Famagusta recorded a modest 1% increase in sales.
Kourousides said delays in issuing building permits were forcing developers to scale back plans, with some companies already considering laying off staff because of stalled projects. He suggested an initiative to create public-private partnerships, suggesting that the government could set aside public land for the development of affordable rental housing.
Kourousides also pointed to the potential for increased demand from high net worth buyers, including Israelis, due to geopolitical tensions. This could further fuel the market and exacerbate the existing shortage of residential properties for locals.
The affordability issues of residential property in Cyprus need to be addressed. If delays in permits continue in the coming years, the new supply will be completely absorbed by foreign buyers, leaving locals in a difficult situation. This highlights the need for comprehensive reforms and government support to address the housing crisis.
