19.06.2023
While there is considerable potential for foreign investment in the Cyprus property market, it also comes with inherent risks. Foreign investment is inherently volatile, influenced by numerous dynamic factors that are constantly changing. In essence, if foreign investment fails to sustain its momentum, there is a significant risk that prices will eventually stabilize /decline.
Thus, in order to determine the path of prices, it is necessary to be confident in assessing the direction of inflation, interest rates, GDP indicators (Cyprus, EU, US, UK) and whether foreign investment rates will remain stable in the Cypriot market.
Based on the overall economic environment, it appears that the most likely scenario is an initial stabilization in prices, followed by potential downward pressure leading to marginal price declines (less likely in the short term). However, a significant price decline on a large scale is unlikely in the medium to long term given the prevailing economic conditions (other than major political events).
However, it is important to note that if inflation remains high and nominal prices remain stable for an extended period of time, “real” property prices will inevitably decline.
