Cyprus remains an attractive destination for foreign investors, and 2024 confirms the steady demand for property purchases. With a stable economy, favorable conditions for obtaining permanent residence through investments, and infrastructure development, Cyprus’ real estate market continues to be one of the most promising in Europe. For those considering purchasing property, it is essential to understand the key aspects and tax nuances of the process.
Contents
Current Trends in the Cyprus Real Estate Market
High demand for housing among foreign investors. The permanent residence program through investments is the main factor driving property purchases in Cyprus. To obtain permanent residence, one must purchase property worth at least 300,000 euros plus VAT. This makes both apartments and villas in cities like Limassol, Paphos, and Larnaca popular choices.
Rising housing prices. In 2024, property prices continue to rise. The average price of housing in Limassol is around 330,000 euros, and in prestigious areas or along the coast, prices for luxury villas and apartments can exceed 1 million euros. This indicates the island’s sustained attractiveness for international buyers.
Commercial real estate. Investors are increasingly interested in commercial properties, such as offices, hotels, and retail spaces. This segment is particularly in demand in Limassol and Nicosia, where international companies are actively establishing their offices.
Taxes on Property Purchases in Cyprus in 2024
Value-added tax (VAT). For first-time buyers of primary property in Cyprus, a reduced VAT rate of 5% applies to the first 130 square meters of housing. However, the total area of the property should not exceed 190 square meters, and the price should be under 350,000 euros.
Stamp duty. Stamp duty is payable by the buyer of secondary property and depends on the value of the property. The rate is 0.15% for properties up to 170,000 euros and 0.2% for properties exceeding that amount. This tax must be paid within 30 days of signing the purchase agreement.
Local authority fees. Annually, buyers must pay municipal taxes, which include waste disposal, street lighting, and sewerage services. These fees range from 85 to 500 euros, depending on the type and size of the property.
Transfer fees. For secondary property, the transfer fee is between 1.5% and 4%, depending on the property value. No transfer fee is applied to primary property if the buyer pays VAT.
Permanent Residence Program through Investment in 2024
The permanent residence program through investment remains a key factor attracting foreign buyers. To obtain permanent residence, a minimum investment of 300,000 euros in new housing is required. This program offers several benefits, including the primary advantage of permanent residency in Cyprus.
What to Expect in 2025?
Forecasts for 2025 suggest that the real estate market in Cyprus will continue to grow. Investors can expect further price increases in luxury and tourist properties, particularly in popular cities like Limassol and Paphos. Meanwhile, the permanent residence program through investment will remain in place, continuing to drive demand for housing among foreign nationals.
Purchasing property in Cyprus in 2024 remains a profitable decision due to growing demand, tax benefits, and favorable conditions for obtaining permanent residence. Whether you are looking to acquire a home for personal use or as an investment, the Cyprus market offers numerous opportunities for a successful deal.
