With the price of rentals surging across Cyprus, affecting both high-end and budget-friendly areas, the Interior Ministry has announced measures to address rising housing costs.
Interior Minister Constantinos Ioannou has unveiled a new housing initiative, “Renovate – Rent“, which is designed to increase affordable rentals by bringing vacant properties back into the market.
The scheme offers property owners grants up to €35,000 to renovate vacant residential units, which will then be leased at affordable rates to low and middle-income tenants. Property owners can apply for grants from 15 November 2024 to 31 December 2025, while tenant applications will be open from 15 January to 31 December 2025.
Eligible properties must have been vacant for at least 12 months prior to 24 October 2023 or between then and 15 November 2024. Vacancies are defined by annual electricity usage below 200 kilowatt-hours. Additionally, properties must have been connected to the Cyprus Electricity Authority grid for at least 15 years as of 24 October 2023.
To qualify, tenants must meet specific income requirements, with income thresholds set from €25,000 for single individuals to €65,000 for families of five or more.
Participating property owners will receive tax incentives, including exemptions from income tax on rental income and defence contributions, along with enhanced capital allowances for equipment purchases. They must commit to renting their units for at least four years at 70 per cent of the market rate.
Grant amounts are based on the size of the unit:
- One-bedroom units: up to €15,000
- Two-bedroom units: up to €25,000
- Three-bedroom units: up to €35,000
Following a four-year affordable rentals period, landlords may extend their participation by at least two more years, becoming eligible for maintenance grants ranging from €3,000 to €5,000, depending on the size of the rental unit
The Cyprus Land Development Corporation will oversee compliance. In cases of non-compliance, sanctions include temporary suspension and grant recovery.
Landlords must also provide a structural safety certificate from a registered civil engineer following renovations.
