Cyprus Real Estate Market in 2015
- Mar 5, 2016
- 2 min read
The Cyprus Real Estate market continues to experience some declines in both property prices and rental rates. However, these are being constrained at minor levels and signs of stability are evident in certain areas. To this end, the significant increase of 20,18% in sales deeds during 2014 compared to 2013 is a strong sign that the market may be starting to stabilise. At the same time, a reduction of 7,64% in the number of building permits issued might suggest that construction activity will remain in a declining trend in the short-term. Moreover, there has been a decrease of approximately 25% from 2014 to 2013 both in respect of the value and in square meters of building permits in Cyprus.
Sales Prices
The average price for a house in Cyprus in Q4 2014 was €326.749. This represents a 5% fall from the same quarter in 2013. Similarly, when compared to the prices of Q4 2013, the largest fall was seen in Famagusta (8,17%), whereas Larnaca is the city with the lowest house prices. House prices did not exhibit a significant fall in Q4 2014 compared to the previous quarter. The largest decline was seen in Famagusta (3,57%), indicating that perhaps the market overall is starting to stabilise. On the other hand, housing prices in Paphos increased by 1,33% from Q3 2014 to the following quarter, reaching €343.341.
Rental Rates
Average monthly rental values on houses as tracked by RICS were €534, a decrease of 3,09% from Q4 2013 to the same quarter in 2014. Nicosia and Limassol suffered a steady decline in monthly rents for houses over the last couple of years. However, in comparison to the previous quarter of 2014, the rental rates in Nicosia increased by 1,71% in Q4 2014, Larnaca exhibited a slight decline (3%), whereas the monthly rents in the other three cities remained the same, an indication of stabilisation of rents in the housing market.
It is believed that the real estate market will follow track on projected economic growth starting in 2016. This will be further enhanced by the availability of financing from local banks following a completion of their current restructuring and recapitalisation efforts. The great natural environment of beaches and mountains, the highly developed infrastructure, the growing tourism market, the low property tax and the climate, make Cyprus ideal for property investment. Added to this, is the benefit of obtaining the Cypriot citizenship as a result of such or similar investment.
Comments