Cyprus property if getting cheaper, and demand is growing

Welcoming and distant island of Cyprus does not risk getting lost in faceless mass of little-known countries. Cyprus is eternal summer, rollicking celebration and transshipment base for international investments. The most important result of 2014 for the real estate market is the fact that property prices decreased again to a certain number of euros. It's time to think about moving, isn't it?​

The last point of rating

Recently the whole world discussed Cyprus, and owners of bank deposits followed the news in tension. For a year and a half the situation has improved, but not much. In 2014, property prices in Cyprus continued to decline and demand on the contrary showed an increase. Foreigners know when you should leave for this paradise!

Here is Knight Frank's statistics for second quarters of different years: 2010-2011 – decrease in prices by 6.6%, 2011-2012 – by 5.9%, 2012-2013 – 5.9%, 2013-2014 – prices dropped by 9.2%, which allowed Cyprus to be the last in this list of the top fifty countries.

Analysts from RICS agree with their colleagues from Knight Frank: in the third quarter property prices in Cyprus were 9.6% lower than last year. Namely, prices for houses fell by 4.4%, apartments and offices – by 6.3%, commercial premises – by 9.6%. The market in Nicosia was affected most of all. However, markets in other major cities, according to RICS report, "are moving steadily to price bottom".

The market in Nicosia was affected most of all

Larnaca: the most expensive apartments, and the cheapest houses in Cyprus

Apartments on the island can be purchased for an average of €1,205 per sq.m. As always, there are leaders and outsiders. Prices for apartments in Famagusta and Paralimni strongly tend to Bulgarian ones, and cost per square meter has already dropped below €1,000. At the other end of the list there is Larnaca, where a square meter costs €1,338.

Prices for houses are quite comparable. An ordinary for Cyprus two-family house costs €1,321 per sq m: the most expensive one is in Nicosia (€1,537), the cheapest is in Larnaca (€1,109).

House vs. apartment: to live, spend holidays or rent out

There is no great difference between prices of apartments and houses in Cyprus. So we get a question: what and where to buy? According to statistics, in 2014 foreigners preferred Paphos and Limassol, while the smallest number of transactions with foreigners was in Famagusta.

In Larnaca – the most expensive flats (€1,338 per sq.m) and the cheapest houses in Cyprus (€1,109)

For several years, demand for detached houses has been keeping pace with demand for apartments. If your goal is not living in Cyprus but coming on holidays from time to time, an apartment is your choice. It is cheaper, utility bills are lower, and income from renting out is higher.

By the way, housing rental is getting cheaper not so alarmingly fast, as housing itself. For the year rates for apartments fell by 1.2% and for houses and offices – by 0.9%. Rental income in Cyprus remains stable, but quite low compared to what you can get in other countries.

If your goal is not living in Cyprus but coming on holidays from time to time, an apartment is your choice. It is cheaper, utility bills are lower, and income from renting out is higher

Cautious return of foreigners

After last year's failure of sales caused by banking crisis, the increase in the number of transactions is not impressive, but there's no mistaking the fact. During the first 11 months the island's residents bought 20% more houses (2,977 in total). Foreigners are even a little ahead, having made 21% more transactions (1,096) than for the same period last year.

If prices continue to fall in 2015, and nothing predicts the contrary, one can expect further increase in sales. The motive is not only an opportunity to relax by the sea in your own apartment, but the prospect of obtaining a residence permit, which the Republic of Cyprus offers for buying a property from €300,000, and Northern Cyprus – for purchasing any property.

Text: Alexander Fetyukov, ee24.com

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