There is an increased interest on the part of Ukrainians, which is fixed with the beginning of the Russian invasion of the country, in both commercial and residential real estate in Cyprus and Limassol. This is a fact that can be interpreted as clear evidence of the intention of companies from Ukraine to move their offices to Cyprus, while transferring their staff to our island.
The increased executive demand for real estate from Ukrainians was confirmed by the first executive director of the D. Zavos” Michalis D. Zavos.
“Cyprus remains a safe place, ideal for investment and business. “Even if the war stops tomorrow, companies and citizens will continue to seek refuge in Cyprus,” Mr. Zavos said.
According to him, demand has grown in all kinds, but mainly in luxury real estate. “Most of those who come to Cyprus are highly paid and rent property for 5,000-6,000 euros per month,” he said.
Renting is the most sought after option
The increased demand, which currently outstrips supply, is mainly for rent, which, combined with rising construction costs, has led to higher prices. For example, as Mr. Zavos noted, the cost of renting a property, which cost 1,000 euros two years ago, is now 1,700 euros.
In fact, Mr. Zavos expressed his assessment that the prices for commercial and residential real estate when buying, and mainly when renting, in Limassol will continue to grow.
However, he stressed that in comparison with other European cities, as well as with other quality destinations, the rent here is low.
We are not losing Russians
According to Mr. Zavos, the demand from the Russians has significantly decreased due to their economic constraints, and not because they did not choose Cyprus. We add that until the issues of the war are resolved, there will be a problem in the movement of Russians, including those who regularly come for investment purposes.
“In addition, problems have been created with those who bought in the past and paid gradually, as they can no longer fulfill their obligations due to sanctions,” he said.
However, Mr. Zavos expressed confidence that when the current events are over, the Russians will return, since the reason for the cessation of their activities is not the lack of money, but the difficulties they face due to the sanctions they receive from the West.
“Cyprus will always be Plan B, not only for Russians, but also for Ukrainians. “Now we are losing a large number of Russians, but they will return,” he said.
A new market is being created…
Mr. Zavos emphasized that despite the calamities of war, there are always new opportunities, calling Limassol the new little Dubai.
According to him, the increase in property prices is due to the fact that its value is rising, which has been observed even stronger since the day of the invasion.
“The fact that real estate is growing creates good investment prospects for both foreigners and Cypriots, especially now that banks have set negative interest rates on deposits. Limassol has a high ROI of 5-6% when buying and 6-7% when renting, which is much higher than in other European cities.“At the same time, lending rates in the banks of Cyprus are extremely low, which increases the opportunities for investment in real estate.”
Asked about demand in other markets, Mr Zavos said UK demand has picked up in recent months, possibly due to Brexit.
In addition, there is a great demand from Israel, both for residential and commercial real estate, and mainly for investments, since the yield in Cyprus is much higher than in Israel (2-3% in Israel).
Finally, he noted that there is demand from European countries, mainly from France and Italy, but also from other countries.