The conditions in the Cypriot banking system in recent years regarding increased household liquidity as a result of spending restrictions during the pandemic make the current period an ideal investment period. An investment that could turn into the real estate sector, traditionally the most popular and stable sector of the Cypriot economy, as despite the fluctuations that occur from time to time, it is nonetheless a timeless value.
During this period, due to increased liquidity and the ECB’s monetary policy measures, banks not only lowered deposit rates, but also applied negative interest rates in some cases. Hellenic Bank has -0.6% for deposits over 100 thousand rubles. euros per client and the Bank of Cyprus -0.5% for deposits over 50 thousand euros. At the same time, according to the Central Bank, household deposits in Cyprus in December 2021 amounted to 25.7 billion euros compared to 23.8 billion euros in December 2019. Growth of almost 2 billion euros against the background of the pandemic! At the same time, due to intense competition, commercial banks provide loans at historically low interest rates. We believe that the present is an ideal period for anyone who has the financial ability to change their investment philosophy and spread out their investment portfolio. In addition to the data in the banking system, market conditions are now suitable for investments. The supply of real estate of all types is large and will continue to grow in the future, especially as banks continue to sell overdue loans to specialist management companies.As everything shows that we are emerging from a pandemic that has been afflicting the global economy for over two years now, the conditions in Cyprus are ideal for real estate investment. Both because the supply of real estate is large, and because it is predicted that in the coming years the Cypriot economy will show significant growth rates. In terms of the direct and indirect investments that the implementation of the Recovery and Sustainability Plan will bring, both the broader outlook and the real estate sector are particularly favorable. In addition to the increased demand for property, mainly apartments, there will also be an increase in the demand for property to rent as a result of the pandemic and the shift to more isolated holiday options.
Of course, in the case of non-professional investors, it is implied that the interest should relate to investments that will not jeopardize the overall financial situation of the family, so that we do not again have the phenomena of the period 2011-2013. However, by investing in suitable real estate, one can reap much greater returns than the bank interest rates and security offered by investing in an area that is stable and has a very good chance of growth in the coming years.
Of course, since these are very important decisions, those who decide to invest in the real estate sector should do it the right way, using professional licensed real estate agents and avoiding various experts who try to take advantage of the situation.