22.01.2022
Property prices in Cyprus rose in the third quarter of 2021, according to a report from the Central Bank of Cyprus released on Friday.
According to the central bank’s quarterly report on residential property price indices, the increase in prices was mainly due to the sale of apartments.
At the end of the third quarter, real estate prices rose by 0.5% compared to the second quarter, compared with the previous quarter by 0.3%. Meanwhile, the annual increase in the third quarter was 1.2%, which is 0.9% higher than the annual increase recorded in the second quarter.
Housing prices showed different trends compared to apartments, with the former falling in some parts of Cyprus both quarter-on-quarter and year-over-year.
In all districts, house prices fell by 0.3% year on year, while they rose by the same quarterly difference, mainly due to rising costs in Larnaca and Paphos.
Conversely, apartment prices increased by 1% quarterly while they jumped a whopping 4.5% year on year. This confirms the high demand for apartments in Cyprus over the past two years.
According to the analysis of the real estate market of the central bank, the main reasons for the expressed preference for apartments are subsidies for new home buyers, rising rental prices, as well as an increase in the cost of building materials. According to the Cyprus News Agency (CNA), which refers to unofficial sources in the real estate market, the demand for property from foreign investors has also decreased.
The report adds that foreign investors are now looking at properties with a lower value compared to last year, due to the discontinuation of the Cypriot citizenship by investment program.
As for the breakdown by district, central bank data shows that residential property prices recorded quarterly increases in Limassol (0.1%), Larnaca (1.7%), Paphos (1.6%) and Famagusta (0.6 percent). ). Residential property prices in Nicosia remained stable.
On an annualized basis, residential property prices rose in Limassol (2.9%), Larnaca (2.9%) and Paphos (1%) and fell in Nicosia (1.2%) and Famagusta (0.7%).
According to the central bank, the growth in the cost of residential real estate is primarily the result of an increase in domestic demand while stabilizing the interest of foreigners.
With regard to the current demand from foreign buyers, it was partly driven by the government’s initiative to establish an international headquarters, as a result of which a number of foreign technology companies moved to Cyprus.
