11.11.2023
The Cyprus property market shows no signs of slowing down, fueled by foreign buyers as 2023 is on track to be the best year since 2008 when the global property crisis began.
The property market has proven resilient, but stakeholders continue to bet on rising foreign investment despite the uncertainty prevailing in the economic environment due to the energy crisis, rising interest rates and war in the Middle East.
According to Land Registry data on purchase and sale documents, the first 10 months of 2023 were the best in the history of the industry since 2008. According to the data, 12,825 sales documents were filed through October, up from 10,781 last year, a whopping 36.2% increase. This is the best ten-month period since 2008, when sales reached 13,261 units.
Eleni Averkiu said that the real estate market continues to grow, while events in neighboring countries are not causing significant damage.
Averkiou noted that Limassol dominates in absolute numbers (4225), maintaining a noticeable difference of over 45% with Paphos (2878), and remains the most popular choice for investment.
Documents submitted for the sale of property in Larnaca , up from 1,976 last year. Sales in Paphos increased by 25.3%, reaching 2878 from 2297. Growth in property sales was also observed by 21.8% in Famagusta , 14.17% in Limassol and 8.3% in Nicosia.
“Interestingly, all districts except Nicosia recorded double-digit growth. Notably, it is Larnaca that stands out when it comes to growth,” said the property analyst. She noted that sales figures in Larnaca show an increase of 32% compared to last year. “In terms of growth alone, Larnaca is a champion in attracting new investment interest after experiencing rapid growth since the end of the pandemic. This is the result of various development and infrastructure projects announced in recent years, which give additional impetus to the market and increase investment interest,” said Averkiu.
Although Nicosia has been a fundamentally strong market since the end of 2022 and 2-3 months ago, sales here have slowed down again. “However, after the summer the situation changed.”
Averkiou said much of Larnaca’s growth and Nicosia’s return to the market was being driven by the saturation process in Limassol and prices reaching record highs. “We have seen interest from companies wanting to relocate or set up shop in Cyprus, which has spread from Limassol to Larnaca and to some extent to the capital.”
She said Larnaca is particularly popular with Israelis moving to the island, creating demand for luxury properties that are in limited supply in the area. “This may well support the construction of housing projects in the coming months. Receiving inquiries to buy in Larnaca has become more or less a daily occurrence, while employees of Limassol- based high-tech companies look for houses to rent in the capital. Especially from people who can work remotely.”
The estate agent noted that Nicosia also benefits from Ukrainian refugees who initially settled in Limassol.
Averkiu expects the market and prices to stabilize next year. “It will also depend on developments regarding debt collection law. If banks are given the green light to foreclose on key tenants, we could see a growing pool of available properties, which will further increase sales.”
Director of Delfi Properties George Foucarides confirmed the flexibility of the real estate market. “Despite the ongoing challenges that are beginning to affect it, the Cypriot property market is showing remarkable resilience. Both domestic and international demand for real estate remains virtually unchanged. The ever-increasing interest of foreign buyers has proven decisive at a time when local buyers seem more cautious,” said Foucarides .
Delfi Special Projects Manager Partners and Company Natasha Apostolou said: “Cyprus, thanks to its political stability and attractive legal framework, is currently one of the fastest growing investment centers in Europe.” She argued that the revival of the real estate sector is largely driven by foreign capital.
“Rapid growth and the influx of foreign capital have driven up prices, while there has been a marked increase in demand for luxury homes and Class A offices as many foreign companies have moved their offices and staff to the island. However, balancing foreign investment with local needs is of paramount importance to achieve and ensure sustainable and long-term growth of the sector at a time when rising inflation is putting pressure on the economy.
Delfi Properties recently released data on average home sales prices in each area for the first eight months of the year. Nicosia has the lowest average house sale price, €180,000, recorded from January to August, which is well behind the Limassol area , where the average sale price is €326,000. The average price in the Nicosia area decreased by -1.2% compared to last year, in contrast to Limassol, where the average price increased by 11.5%.
Famagusta region recorded the biggest year-on-year increase in average sales price, jumping 52.4% to €272,000. Paphos follows with 230,000 euros and an increase of 14.4%. In Larnaca, the average sales price in the first eight months reached €194,000, an increase of 8.3%.
