Thanks to favorable mortgage schemes of banks and increasing wealth of people.
The situation. Residential property sales in Cyprus are on the rise, and local market experts believe that the upward trend in demand and, therefore, prices recorded in 2021 will continue next year.
Despite the fact that the figures have not yet reached pre-2008 levels, the market has now stabilized at its highest level in more than a decade. According to rating agency DBRS, property prices in Cyprus are up 87% compared to the first quarter of 2008.
Quote. George Mouskides, chairman of the Cyprus Property Owners Association, said 2021 was an unexpectedly good year with sales close to pre-pandemic levels.
“Sales have been rising since 2013, when the market bottomed out, except for 2020, due to the coronavirus outbreak and restrictions. However, residential real estate is back in demand as a result of the island’s overall improved financial situation.
Prices are also rising, aided by demand and rising prices for building materials, causing the final cost of new buildings to rise by more than 20 percent. In addition, the financial situation of the population has also improved.
We expect this upward trend to continue in 2022, albeit at a slower pace. That is, of course, if we don’t have any unexpected events, such as the emergence of a more powerful strain of coronavirus.”
Details. According to a real estate expert, the housing market is driven by demand for apartments in city centers, which is nearly 70 percent. Houses in the suburbs are also of high interest.
Nicosia is the leader in the demand for residential property, mainly due to Cypriots who want to buy a home. It is followed by Limassol, despite the rejection of the citizenship scheme for investment. There is still demand from British expatriates and Chinese investors in Paphos. But the sale of real estate to third country nationals is declining.
Real estate expert Antonis Loizou argues that residential property sales have been stimulated by the willingness of banks to provide mortgages to young couples through the government interest rate subsidy scheme. The scheme provides a subsidy of 1.5% for four years.