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Sales of Cyprus apartments surge as buyers seek affordability

Nigel Howarth
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Sales of Cyprus apartments surge as buyers seek affordability

A pronounced shift towards more affordable housing options is reshaping the property market in Cyprus, with apartments firmly dominating buyer preferences, according to a 2025 analysis by Landbank Analytics.

The analysis highlights both the realistic purchasing power of households and a growing divergence between mainstream demand and higher-value investment activity.

Apartments lead property sales in 2025

Apartments represent the primary choice for the vast majority of buyers, accounting for 6,382 transactions with a combined value reaching €1.77 billion.

Demand is heavily concentrated in lower and mid-price brackets, with the €150,000–€300,000 category recording 3,396 sales, representing 53.2% of all apartment transactions.

The €0–€150,000 segment follows with 1,353 transactions (21.2%), reinforcing the view that the market is largely operating within the financial reach of the average household.

Activity declines noticeably at higher price levels. The €300,000–€500,000 range recorded 1,205 sales (18.9%), while transactions above €500,000 remain comparatively limited.

Specifically, 234 apartments were sold between €500,000 and €750,000 (3.7%), 60 up to €1 million (0.94%), and 134 above €1 million (2.1%), confirming that the luxury apartment segment remains relatively niche.

Houses shift towards higher price brackets

In contrast, the housing segment demonstrates a clear shift towards higher price brackets, reflecting a distinctly different market structure.

Out of 1,437 house sales, the largest share was recorded in the €300,000–€500,000 category, which accounted for 574 transactions (40%).

The €150,000–€300,000 segment followed with 405 sales (28.2%), while activity at higher price levels remained significant.

A total of 255 houses were sold between €500,000 and €750,000 (17.75%), 80 between €750,000 and €1 million (5.6%), and 116 properties exceeded €1 million (8.1%).

At the lower end of the market, supply remains extremely limited, with just seven transactions recorded below €150,000 (0.5%), underlining the rising cost of construction and housing delivery.

Two-speed property market

According to Landbank Analytics CEO Andreas Ph. Christophorides, apartments have effectively become a “safe haven” for middle-income families and small-scale investors during a period of market adjustment.

Houses, meanwhile, have consolidated their position as a choice primarily for higher-income buyers, creating what increasingly resembles a two-speed housing market.

Overall, the analysis paints a picture of a property sector adapting to economic realities. Demand for affordable housing remains robust, while interest in premium real estate continues selectively, sustaining activity at the top end of the market.

Cyprus foreclosure reforms set for April vote

Nigel Howarth
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0
Cyprus foreclosure reforms set for April vote

Cyprus lawmakers are preparing to vote on a series of foreclosure reforms designed to strengthen protections for borrowers, particularly homeowners at risk of losing their primary residence.

The proposed legislation is expected to reach the House plenary on 6 April or, 16 April at the latest, following continued scrutiny by the Parliamentary Finance Committee.

The reforms aim to address gaps in the current legal framework governing repossessions while balancing the rights of lenders and consumers amid ongoing economic pressures.

Key foreclosure proposals affecting borrowers & guarantors

Among the most significant provisions is a proposal limiting guarantors’ liability where mortgaged property is sold at auction. Under the measure, guarantors would not be responsible for amounts exceeding the original loan value once auction proceeds have been deducted.

Another proposal would require banks or vulture funds to wait for a court decision before pursuing guarantors when borrowers legally dispute the amount owed.

Additional draft laws would give borrowers greater ability to seek court suspension of foreclosure proceedings where the debt amount is contested or unfair contractual clauses are alleged.

Debt relief and interest restrictions considered

Further measures under discussion include the possible cancellation of any remaining debt where auction proceeds fail to cover the full loan balance plus interest. Lawmakers are also examining proposals to prevent lenders from charging additional interest once total debt reaches twice the original borrowing amount.

Changes to insolvency procedures and rules governing minimum sale prices for foreclosed properties are also being reviewed, including maintaining reserve prices at 50% of market value six months after an initial auction.

Government bills introduce debt restructuring options

Two government bills introduce the option for debt restructuring during the foreclosure process and propose making decisions by the Financial Ombudsman binding for disputes up to €20,000.

However, legal concerns have emerged over certain provisions, particularly regarding the suspension of enforcement procedures and the constitutional validity of binding Ombudsman rulings.

Foreclosure decision expected in April

The Finance Committee continues to refine the legislative package amid a large number of party proposals. The final outcome will shape the regulatory landscape for distressed property assets and could significantly affect borrowers, lenders and the wider Cyprus real estate market.

Short-term rentals reshape Cyprus property market

Nigel Howarth
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Short-term rentals reshape Cyprus property market

The rapid expansion of short-term rentals has significantly transformed the Cyprus property market, with platforms such as Airbnb driving new investment strategies and development trends.

What began as a supplementary income stream has evolved into a structured business model, influencing pricing, design and sales across the island.

Rising tourism demand, changing traveller preferences and the appeal of flexible accommodation have created favourable conditions for sustained growth. Professional operators now manage portfolios of multiple units, positioning short-term rentals as a central pillar of real estate investment rather than a niche opportunity.

Limassol leads year-round short-term rentals demand

Limassol remains the dominant market, benefiting from its cosmopolitan profile, strong business activity and concentration of international professionals. Demand is supported by both leisure and corporate visitors, enabling consistently high occupancy levels throughout the year.

Luxury developments, modern apartment towers and the marina contribute to a premium rental product capable of generating attractive yields compared with more seasonal destinations.

Paphos maintains strong tourism appeal

Paphos continues to attract robust visitor numbers, particularly from the United Kingdom and central Europe. Although demand is more seasonal, competitive acquisition prices allow investors to achieve solid percentage returns, especially for well-located apartments near coastal attractions.

Larnaca and Nicosia offer stable alternatives

Larnaca is gaining momentum due to ongoing seafront regeneration and proximity to the island’s main airport, making it ideal for short stays. Meanwhile, Nicosia’s market is driven largely by business travellers, academics and conference visitors, offering stable yet more moderate returns with lower seasonal fluctuations.

Famagusta focuses on villa short-term rentals

In Ayia Napa and Protaras, detached villas with private pools dominate. These properties cater primarily to families and groups seeking privacy, producing strong summer revenues despite limited winter demand.

Collaborative investment model gains ground

A notable trend is the partnership between developers, investors and professional rental managers. Purpose-built developments are designed specifically for short-term letting, often with pre-arranged management agreements that provide investors with predictable income streams.

With continued regulation and quality standards, the short-term rental sector is expected to remain a key driver of Cyprus’ real estate growth, supporting demand for new developments and strengthening the link between tourism and property investment.

Cyprus property prices soar smashing pre-crisis records

Nigel Howarth
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0
Cyprus property prices soar smashing pre-crisis records

Cyprus property prices have smashed through previous peaks, with the apartment price index reaching its highest level on record in the fourth quarter of 2025, exceeding the previous record set in 2008, just before the property bubble burst.

At a time when the European Union has warned of a mounting “social crisis” in housing, the cost of buying a home in Cyprus continues to spiral, with growing numbers of young people in particular, finding themselves priced out of the market.

The Central Bank’s Residential Property Price Index (RPPI) shows the apartment price index has climbed to 123.9 points, marking a dramatic recovery from the post-crisis slump that saw prices tumble following the financial crisis in 2013. At the lowest point of the downturn, the RPPI fell to 73.4 points in 2013 and 77.8 points in 2014.

Today, the market sits roughly 60% above those lows, underlining the scale of the rebound.

Property prices jump 74.5% in a decade

The latest RPPI figures reveal just how rapidly the market has accelerated. Apartment prices rose to 123.9 points in the final quarter of 2025, up from 112.3 points a year earlier, an annual increase of 10.32%.

Over the past ten years, prices have surged by 74.5%, highlighting the growing challenge facing local buyers who find themselves unable to buy a home.

While construction activity has picked up, supply continues to lag demand, helping to push prices ever higher.

Foreign buyers and rising costs drive the boom

A combination of limited housing supply, improved earnings in some sectors and strong demand from overseas investors has fuelled the surge in property prices.

Rising construction costs have added further pressure. Developers continue to face increased prices for building materials, pushing up the cost of new homes and reinforcing the upward trend in market prices.

Demand remains strong from domestic buyers and international purchasers seeking investment opportunities or properties for short-term rental.

Tourism growth and the continued expansion of higher education have also helped sustain activity across the residential property sector.

Limassol and Larnaca lead the charge

Limassol continues to dominate the market, recording the highest apartment price index in the country at 150.1 points in the fourth quarter of 2025. Prices in the coastal city have skyrocketed by 102.7% over the past decade.

After several years of subdued performance between 2013 and 2017, prices in Limassol have followed a steady upward trajectory since 2019, culminating in a new record high.

Larnaca is not far behind, with apartment prices reaching 150 points; a substantial rise of around 102% over the last ten years.

Nicosia has seen more moderate growth, with the apartment price index reaching 99 points in Q4 2025; a ten-year increase of 29.24% and bringing prices close to levels last seen in 2010.

Paphos has experienced strong gains, with apartment prices climbing to 126.5 points, up 97.04% over a decade.

Famagusta recorded a smaller but still notable increase, with the apartment price index reaching 81.9 points; a rise of 38.5% compared with 2015 levels.

House prices also climb steadily

The upward trend extends beyond apartments. The overall house price index rose to 94.2 points in the fourth quarter of 2025, marking a 24.60% increase over ten years.

Limassol recorded house prices at 107 points, up 38.60% over the decade, while Nicosia saw more modest growth, with house prices reaching 80.1 points up 5.67% over the same period.

Larnaca’s house price index reached 88.9 points, representing a ten-year rise of 23.64%.

Paphos saw house prices climb to 108 points, up 36.19%, while Famagusta recorded house prices at 95.9 points, an increase of 33.56% compared with 2015.

Lower interest rates add fuel to the market

According to the Central Bank, the continued strength of the property sector is partly linked to the gradual easing of European Central Bank monetary policy since mid-2024.

Interest rates have converged with the Eurozone median and, since May 2025, have remained consistently below it, supporting mortgage lending and encouraging borrowing.

Demand for owner-occupied homes, buy-to-let investments and short-term rental properties remains strong, helping to sustain momentum across the market.

Despite increased building activity, supply still struggles to keep pace with demand, which suggests  upward pressure on prices may continue.

Cyprus construction sector looks to the next decade

Nigel Howarth
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0
Cyprus construction sector looks to the next decade

The evolution of Cyprus’ construction industry, from traditional craftsmen to modern project leaders, is shaping the next phase of the island’s real estate and infrastructure landscape, according to Stelios Gavriel, President of OSEOK.

Speaking at the 20th Property Development, Real Estate and Construction Conference in Nicosia, Gavriel highlighted the sector’s enduring contribution to economic growth, while warning that the coming decade will be defined by labour shortages, rising construction costs, sustainability demands and the need to rebuild trust across the industry.

Construction & contractors at heart of modern Cyprus

Gavriel emphasised that the story of Cypriot contractors is closely intertwined with the country’s modern development. From the skilled builders of the 1930s to today’s sophisticated construction firms, the industry has played a central role in shaping homes, schools, hospitals, transport networks and commercial infrastructure.

He described early craftsmen as driven by determination, technical skill and a desire to create opportunities for future generations. Many family-run firms have passed knowledge through successive generations, reinforcing the sector’s continuity and resilience.

From craftsmen to project leader

The role of the contractor has evolved significantly. Historically defined by technical expertise on site, today’s contractor operates as a business leader responsible for complex investments, multidisciplinary teams and strategic decision-making.

Modern construction professionals must combine engineering knowledge with financial management, risk assessment and regulatory compliance, working closely with architects, investors and financial institutions. Digital tools, sustainability standards and energy efficiency targets have further transformed the industry’s operational framework.

Construction: a key pillar of economic activity

The construction sector remains a major contributor to Cyprus’ GDP and employment, supporting a wide ecosystem of related industries including property developers, material suppliers, logistics providers and design professionals.

Each project generates multiplier effects across the economy, stimulating investment activity and strengthening infrastructure capacity. Beyond financial impact, large-scale developments have helped shape Cyprus’ contemporary urban identity.

Workforce pressures and rising costs

A shortage of skilled labour is emerging as one of the sector’s most pressing challenges. An ageing workforce combined with limited entry of younger professionals has intensified the need to attract talent from abroad.

At the same time, global economic uncertainty continues to influence material prices and supply chains. Key construction inputs such as aluminium and steel have experienced price volatility, while energy costs are expected to further increase pressure on project budgets over the coming years.

Contract reform and industry trust

Gavriel also called for modernised public procurement frameworks aligned with international standards, including faster dispute resolution mechanisms such as arbitration. Improved contractual structures could help minimise delays and reduce project risk in both public and private developments.

Rebuilding trust among stakeholders – contractors, engineers, investors and public authorities – will be essential to maintaining momentum in the sector.

Vision for the next generation

Looking ahead, Gavriel stressed the importance of attracting younger professionals and encouraging Cypriot construction firms to expand internationally. With the domestic market relatively small, outward-looking strategies could strengthen competitiveness and support long-term growth.

Despite ongoing challenges, the sector’s experience and adaptability position it to remain a central driver of economic development and real estate investment in Cyprus over the next decade.

 

Cyprus moves to revive mortgage-to-rent scheme

Nigel Howarth
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0
Cyprus moves to revive mortgage-to-rent scheme

Cyprus is poised to reopen its “Mortgage-to-Rent” scheme for a limited period, in a move aimed at easing pressure on distressed homeowners.

Finance Minister Makis Keravnos signalled to Parliament’s Finance Committee that the government is open to accepting new applications for several months, provided the existing eligibility criteria remain unchanged.

Maintaining the current framework is seen as essential to avoid a fresh approval process from European authorities, an outcome officials are keen to avoid due to time constraints and the risk of rejection.

The proposal to revive the Mortgage-to-Rent scheme was put forward by MPs and has been met with a positive response from the ministry, so long as it does not place additional strain on public finances.

Foreclosure reform bills tabled in parliament

At the same time, two key bills targeting Cyprus’ foreclosure framework have been formally submitted to the House of Representatives. The legislation, approved by the Council of Ministers earlier this week, is designed to support borrowers and prevent the loss of primary residences.

Central to the reforms is the strengthening of the Financial Ombudsman’s role, alongside enhanced protections for homeowners. Lawmakers were briefed during a closed-door session of the Finance Committee, reflecting the sensitivity of the issue.

Stronger protections for borrowers

Among the proposed measures is the introduction of binding decisions by the Financial Ombudsman for disputes of up to €20,000, which covers the majority of cases, according to government data. Borrowers would also gain earlier access to the Ombudsman to facilitate debt verification and restructuring.

In addition, the reforms provide for the creation of structured repayment plans through insolvency advisers, allowing borrowers more time to stabilise their finances and avoid foreclosure.

Balancing stability and social pressures

Keravnos stressed that safeguarding financial stability remains the government’s overriding priority, particularly amid global economic uncertainty and inflationary risks. He cautioned against measures that could unsettle the economy or undermine growth.

Political divisions persist

Despite broad agreement on the need for reform, political tensions remain. Opposition figures have criticised the government for resisting broader legal rights for borrowers to challenge foreclosures in court.

Debate is expected to intensify in the coming days, with several party-backed proposals also under consideration before Parliament potentially dissolves ahead of upcoming elections.

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