Cyprus property prices continue to rise

New figures show that the Cyprus residential property price index registered a 0.5 per cent increase in the second quarter of 2019 compared to the previous quarter.

On a year-on-year basis, prices were up by 2.8 per cent.

According to data published by the Central Bank of Cyprus (CBC), the index registered an increase in all districts of Cyprus.

Apartment prices increased 1.1 per cent quarterly and 4.3 per cent year-on-year, while house prices rose 0.3 per cent quarterly and 2.3 per cent year-on-year.

Annually, there were significant increases in the prices of apartments in Larnaca (9.4 per cent) and Limassol (7.2 per cent), mainly in coastal areas due to foreign demand.

“The index of residential property prices in Cyprus continues to grow, along with the recovery of several macroeconomic indicators and the economy in general,” the CBC said.

However, they warned that “there are uneven increases in specific areas, but also downside risks, so it is useful, if not necessary, to follow events closely.”

The CBC notes that the continued decline in demand for real estate for the purposes of the Cyprus Investment Program can reduce or lower real estate prices in certain areas.

The Central Bank attributes the increase in apartment prices to an insufficient supply in the market, since it cannot meet the needs of the largest number of foreign students and workers who choose to live in apartments instead of houses.

The CBC said the demand for luxury properties declined after the controversial Cypriot passport for investment scheme tightened its criteria in May 2019.

Article published 15th January 2020