15.02.2023
According to an in-depth analysis by PwC, the total value of real estate transactions in Cyprus reached a record level of 5.2 billion euros in 2022, recording an annual growth of 27%.
In physical terms, the number of real estate transactions concluded last year reached 22,500, up 12% from the previous year, exceeding the pre-pandemic level of 2019 by 31%.
During the year, Limassol, Larnaca and Paphos saw double-digit annual growth in transaction volumes (18%, 23% and 31% respectively). On the other hand, in the Nicosia and Famagusta areas there was a slight drop of 6% and 1% respectively.
Undoubtedly, the driving force of the market is related to apartments, the value of transactions of which in 2022 will reach 2.1 billion euros, which is 42% more than in 2021.
“Demand appears to have been fueled by the growing desire of companies with foreign interests to relocate their operations and personnel to the island, mainly to coastal areas, and was further supported by a strong domestic segment,” the PWC Cyprus report says.
PwC data shows that 9,000 apartments were sold during the year, representing an annual increase of 29%.
Elite real estate
The termination of the Citizenship by Investment program (from November 1, 2020) has led to an observed decrease in the level of activity in the luxury residential segment (≥ 1.5 million euros).
During 2022, there has been a partial recovery in this segment with 220 high-end residential property transactions registered, representing a 36% year-on-year growth and indicating that the sector remains active.
The volume of residential property valued between EUR 100,000 and EUR 300,000 reached EUR 7,600, representing an annual increase of 19% and a surge of 41% compared to the pre-pandemic year 2019, housing (especially apartments), combined with a growing level of foreign demand in the context of moving to Cyprus,” PwC said in a statement.
Cost of materials
Despite rising levels of demand for real estate, as evidenced by transaction data, issuance of building permits slowed during the first 10 months of 2022, recording a 5% annual fall.
This is largely due to the continuous rise in material costs that has persisted through 2021 and 2022, with prices rising by 30% in two years, which “tipped the market balance and especially in the private/individual housing segment.”
PwC Cyprus Partner Konstantinos Konstantinou said: “With multiple challenges and crises to be dealt with at a broader geopolitical level, the Cyprus property sector has proven particularly resilient, exceeding expectations in levels of transactional activity seen throughout the year, ongoing demographic shifts observed on the island.
