Cyprus Property Market Recovers

The property recovery is underway in Cyprus with the latest figures showing that prices for villas and flats are increasing and sales are also rising.

The latest figures from the Royal Institution of Chartered Surveyors (RICS) shows that across Cyprus residential prices for both houses and flats increase by 0.6% and 0.9% respectively in the third quarter of 2016.

Meanwhile, data from the island’s land registry show that sales increased by 121% year on year in December 2016, the largest annual rise for a decade. This followed increases of 50% in September, 37% in October and 46% in November.

Year on year sales rose across the island with transaction rising the most in Nicosia and Limassol with growth of 156%, followed by Paphos with growth of 137%, Famagusta up 107% and Larnaca up a more modest 18%.

A breakdown of the RICS data shows that the biggest increase in property prices was in Paphos where house prices increased by 1.77% and in Limassol where apartment prices were up by 1.4%.

Values for holiday homes also increased, up by 1.6% for flats and 0.4% for houses. Compared to the third quarter of 2015, prices increased by 0.6% for flats, 0.9% for houses.

The RICS report points out that during the third quarter of 2016 the Cyprus economy showed further signs of stability with the economy’s performance being better than expected and tourism mildly outperforming forecasts.

However it also points out that due to the prevailing economic conditions and the turbulence in Cyprus’ banking system, there were relatively few transactions during the quarter although volume was higher on a year on year basis.

Across Cyprus rents increased quarter on quarter by 0.7% for apartments and 3.3% for houses and were up 5.3% year on year for flats and 6.7% for houses.

Both report suggest that it is foreign buyers returning that are helping the property market to recover. RICS pointed out that local buyers are few and far between while the land register figures show that 31% were buyers from overseas.

Sales to foreign buyers rose 162% in December compared with December 2015. They increased in all district compared with December 2015. In percentage terms Famagusta led the way with sales up 1,400%, (having sold just one property in December 2015, followed by Paphos where sales rose by 227%. Meanwhile, sales in Nicosia, Limassol and Larnaca rose by 180%, 172% and 18% respectively.