Changes in data on the real estate sector in Limassol. Increased demand, recorded by the local residential market, is gradually shifting the interest of developers to the construction of more affordable real estate, largely putting aside the creation of luxury complexes.
Ahead of the 2nd Limassol Business & Investment Summit held at the Park Lane Luxury Resort in Limassol earlier this month, analyzing current trends in the real estate sector, Imperio Founder and Director and Deputy President of the Pancyprian Association of Land Surveyors Yannis Misirlis noted that the period pandemics and recent events related to the war in Ukraine have stimulated demand for more affordable real estate, while at the same time interest in more expensive final living quarters. “The arrival of many foreigners – professionals and non-professionals – in Limassol, combined with the increased purchasing power of local residents and attractive financing programs offered by local banking institutions due to low interest rates, have created a significant demand for real estate. designed for the average buyer,” said Mr. Misirlis.
Commenting on the fact that Cypriot real estate in previous years was focused exclusively on the creation of luxury real estate, Mr. Misirlis explained that in the period after the reduction of deposits in 2013, many potential buyers were forced to reconsider their plans and turn into tenants. . Then, local demand for real estate fell sharply, leading land development companies to turn their attention to overseas markets. This development, added Mr. Misirlis, has left the local market unused. “We have left a big gap, to which some companies of the sector have gradually turned their interest again,” Mr. Misirlis stressed. He also added that “Imperio is one of the first companies to refocus on this part of the market in July, the first phase of our Sunset Gardens residential complex in the western part of Limassol, a gated complex with over 300 apartments, targeted at this specific category of buyers, will be released to the public.” .
Two-Piece Solution for High Rent
The director of Imperio also spoke about the rental market, confirming that during this period, the level of rent is at its highest level in recent years. As he explained, rents in Cyprus were high anyway due to the reduced supply of suitable properties. However, he added, recently this phenomenon has intensified due to the relocation of many foreigners (Ukrainians, Russians due to the war) to Cyprus, especially to Limassol, and on the other hand, the preferences of many millennials, who make up the youngest age group of tenants, to stay for a much longer period on loan.
Conveying his position on the proper way to stop this phenomenon, Mr. Misirlis opposed some groups’ proposal to install a rent ceiling (rent control), as he pointed out, this would result in two speed properties and tombstones would be installed anywhere . owner’s plans for repair and improvement;
The director of Imperio expressed the opinion that in order to solve the problem, the state should provide appropriate incentives that will encourage the private sector (private investors) to invest more in properties that are in great demand, such as apartments. , with the obligation that they will be available for rent within a certain period of time, for example. 10 years. Similar tax incentives are offered in many European countries.
At the same time, in order to reduce the demand for rent, Mr. Misirlis recommends the introduction of Help-to-Buy schemes to encourage tenants to buy their own property. “The goal should be to enable tenants to buy their own property. Such plans are working successfully in several countries in Europe, such as Germany, and I think it would be good to study these examples to create our own plan, in order to help stop the upward movement of rents in this way,” Mr. Misirlis concluded.