21.12.2022
Imperio ‘s founder and director sends a message that through challenges there are opportunities that will shape the future of real estate development Yannis Misirlis .
Mr. Misirlis expressed his strong belief that the real estate sector will be able to cope with difficulties and face challenges, mainly as a result of geopolitical developments. He also highlights the urgent need for the sector to focus on adopting sustainable practices by all sector businessmen in their new projects, while communicating their 2023 property price and rent estimates.
The economy will also face numerous challenges in 2023, mainly due to the negative external factors that have heavily affected us for many months.
However, the Central Bank’s estimates that inflationary pressures will be moderate in 2023 and 2024, with inflation at 3.9% and 2.1% respectively due to an expected gradual correction in oil and food prices, allow us to be optimistic.
Equally optimistic are the Finance Ministry’s forecasts of around 3% growth , as well as inflation supporting hopes that the new year will bring better days compared to 2022.
Real estate problems
What are your forecasts for the land and real estate sector for 2023? Do you think 2023 will move in a positive sign, a negative sign, or the same as 2022?
It is a fact that inflation, as well as rising prices for energy and building materials, are causing concern in relation to the real estate market.
However, a closer look at the current data in the sector shows that the situation is not so bleak. The increase in building materials may have pushed up property prices and rents, but demand did not seem to change dramatically during the year as property is seen as a safe haven in times of high inflation. At the same time, as has been said on numerous occasions, challenges and uncertainties also create opportunities that businesses and our own sector must seize and exploit.
While 2023 is not going to be an easy year either, I am convinced that companies in our sector will be optimistic about the new data and demonstrate flexibility to change and adapt to trends and preferences of potential investors. Only in this way can real estate cope with the challenges. Like the economy, the real estate sector goes through cycles. It is already evident that young couples are willing to buy new homes, in addition to the interest shown by foreign buyers.
It is worth noting that over the past two years, Cypriot real estate has managed to reduce its dependence on the Russian market, which removes the fears of developers about the impact of the Ukrainian market on the search for foreign buyers. At the same time, more and more foreign companies are active in Cyprus, which fuels interest in buying and renting office space.
What are the important trends and developments to watch out for in your industry in 2023?
I believe that the land management sector still has a lot to offer in Cyprus if it is geared towards the new needs of buyers, local and foreign.
First of all, companies operating in this sector should focus on the increased demand for housing from young couples. As an example, I will mention LionGlobal ‘s study of the first housing market, which shows that millennials will become the dominant force in the real estate market in the coming years .
Significant demand has also begun to be recorded in office space, and this trend will intensify in the future. However, the bigger issue for our sector is the issue of sustainability, how we design and build buildings that have a positive impact on the environment, and how we will change the way companies do business and the policies in the sector in order to achieve this specific goal.
Integrating sustainability into the designs and DNA of land management companies is key not only to profitability but also to their future survival.
At Imperio , we have adopted a clear ESG strategy for our projects through which we commit ourselves to meeting some of the United Nations 2030 Climate Goals (SDGs).
Undoubtedly, real estate is subject to strong inflationary pressure. Do you think this growth will continue, or do you think that prices, both for buying and for rent, will start to decline?
Rising property prices are a problem that has gradually worsened in recent years, while the rise in raw material and energy prices in recent months has exacerbated the problem.
The situation is exacerbated for young couples, many of whom cannot afford their own housing. In order to find solutions, we must look at what are the real reasons why real estate prices are rising at a rapid rate.
One of the most important factors is the decrease in the supply of suitable properties. Over time, the market corrects itself. But if the conditions are wrong, it may take a long time before we reach the point of automatic market improvement. Hence, this is where limited government intervention is required to correct any distortions.
Such incentives should be provided to encourage and enable the private sector to produce more properties for which there is high demand, such as apartments. With an increase in supply, the problem of high rents will also be solved.
The private and public sectors must work together to create the right conditions to clean up the real estate market by creating enough affordable real estate at affordable prices, as well as through the right financing conditions, so that homeownership does not become a privilege for a few.
In addition, with regard to the rental market, conditions must be created that are conducive to the existence of institutional investors in real estate, which is not the case in the Cypriot rental market compared to similar markets abroad.
By creating the right conditions for institutional investors to invest in a large number of units with a commitment, then make them available on the rental market, the problem of high rents is solved, as more supply will curb the upward trend in prices, and/or possibly reduce them.
Imperio’s goals
What can we expect from your group in 2023? What are your goals?
Following new trends and listening to the needs of the market, at Imperio we design and build projects that meet the needs of investors and offer a high quality of life.
In 2023, we will focus on completing the second phase of Sunset Gardens and making this project the best choice for millennial housing in Limassol . At the same time, we intend to focus on sustainability, ESG and sustainable investment, criteria that are already prominent in our projects. We believe that designing innovative modern real estate is not enough.
The real challenge for us is to touch people’s lives by deeply understanding their needs and fulfilling their dreams. This is what we do, and to this end, we will work on all the new projects that we prepare.
