30.12.2021
On Wednesday, real estate market analysts Delfi Analytics published a report. The data obtained indicate that this year the property market in Cyprus continues its recovery. Some of the indicators approached the pre-Covid level.
“2021 was a year of correcting the anomalies in the market that emerged during 2020, when a significant number of transactions were delayed due to the uncertainty caused by the pandemic,” said George Mounties, managing partner of Delfi Partners & Company.
“At the same time, the recorded overall upward trend in the number of mortgages indicates that the government’s interest rate subsidy plan has had a positive impact on the market,” he added.
The report titled Cyprus Property Market Dynamics shows that transfers of ownership during the first eleven months of the year were 3.4% more frequent than in 2019, the last year before the economy was hit by the adverse effects of the coronavirus pandemic.
Real estate sales and mortgages declined by 4.2% and 4.4%, respectively, over the same time period. However, the total cost of mortgage loans was 82.2% higher, which was due to the boom in the sector in the Limassol area.
That being said, the lack of correlation between the value of mortgages and their actual number points to the fact that several individual mortgages on high-value real estate skewed the numbers.
According to the report, the demand for used property has increased, with 14,228 property transfers completed as of November.This figure is 3.4% higher compared to 2019 and 26.5% higher than last year. However, total sales through November were 4.2% less than in 2019.
In the Nicosia area, most indicators were positive until December this year, with the number of property transfers (27%) and sales (38%) higher than in the corresponding period of 2019.
“The number of mortgage loans was also increased, while the total amount of mortgage loans decreased by 15% compared to the corresponding period in 2019,” the report says.
In the Limassol area, the transfer of ownership increased by 2% compared to 2019 and by 30% compared to 2020.
In terms of sales, they were up 28% year-on-year, but still 11% below 2019 figures.
“In Limassol, the number of mortgage loans has slightly increased. The total amount of mortgages increased sharply, approaching 300%,” the report says.
“This indicates that a small number of mortgages were associated with one or more loans of a very large amount,” the report adds. And while mortgage loans stood at around €900 million in 2019 and 2020, they have jumped to a whopping €3.2 billion this year.
In the Paphos area, the situation was not as positive, at least compared to 2019.
During the first eleven months of the year, property transfers were down 20% from 2019, while sales and mortgages were also down 35% and 15%, respectively.In Larnaca, real estate sales decreased by 8% during the above period compared to 2019. The number of mortgage loans decreased by 11% compared to 2019, although their value was higher by 0.1%.
Finally, in the Famagusta region, all indicators were positive: transfers of property (12%), sales (4%) and mortgages (4%) are higher than in 2019.
“In 2022, the evolution of the pandemic and the emergence of any new variants of the virus, such as Omicron, will be critical for both the real estate sector and the broader economy,” Mounties said.
“According to our estimates, the trend towards the acquisition of secondary properties will continue to grow as the number of properties available on the market through banking institutions and asset management companies increases,” he concluded.
