The declining Cyprus property market

AS we reported on Monday, the number of properties sold in Cyprus during January stood at 375; the lowest monthly figure since records began.

Further Land Registry statistics published earlier today show that of those 375 contracts of sale, 80.8 per cent (303) were in favour of Cypriot buyers and 19.2 per cent (72) were in favour of overseas buyers.

Domestic property sales

Overall, 394 fewer properties were bought by Cypriots in January than in January last year; a fall of 57 per cent and sales were down in all districts.

Nicosia was hardest hit with 136 fewer properties being sold (-77%). Sales in Larnaca fell by 80 (-77%), while in Limassol they were 114 fewer sales (-61%).

Sales in Famagusta fell by 49 (-70%) compared with January 2012, while sales in Paphos fell by 15 (-9%).

Record levels of unemployment, with the jobless rate standing at 14.7 per cent in December, together with uncertainty of the future of the island’s economy plus much talk of increasing Immovable Property Tax are keeping buyers away.

Overseas property sales

Cyprus-wide sales to the overseas property market fell by 34 (-32%) in January compared with January last year; with the exception of Nicosia, sales were down in all districts.

In Famagusta just one property was sold; a fall of 94% on the 16 sold during January 2011. Sales in Paphos fell by 16 (-33%), while those in Larnaca fell by 2 (-15%) and those in Limassol fell by 1 (-4%)

Five properties in Nicosia were sold to overseas buyers, the same as in January 2011.

Estimates of sales to Chinese buyers reaching 2,000 this year appear somewhat ‘optimistic’ – particularly as Chinese investors from Hong Kong have recently published details of their unhappy experiences of buying property in Paphos on the Internet.

A report in the local media claiming that in less than five months more than 800 properties have been sold to third country nationals seeking residence permits appears somewhat exaggerated.

In the last five months, Land Registry statistics show that the number of properties purchased by overseas buyers is 595 according to the number of contracts deposited at Land Registries across the island.