THE CYPRUS Central Bank’s ‘Home Price Index’ reports that home prices recorded the third consecutive quarterly rise (0.3 per cent) during the first quarter of 2017.
House prices rose 0.2 per cent in the first quarter of 2017 compared with the first quarter of 2016; the first annual increase recorded in seven years. Apartment prices rose by an annual 1.5 per cent, while house prices rose 0.3 per cent.
The Central Bank reports that the continued quarterly increases, although small, confirm the course of recovery in the Cyprus real estate sector.
During the first three months of the year, house prices in Nicosia rose 0.2 per cent for a third consecutive quarter. Home prices in Limassol rose by 0.9 per cent, while in Famagusta they rose 0.1 per cent. However, house process in Larnaca and Paphos fell 0.7 per cent and 0.6 per cent respectively.
House prices in Limassol rose by an annual 0.9 per cent. However, on an annual basis, house prices in Famagusta fell 3.7 per cent, while in Paphos, Larnaca and Nicosia they fell by 1.4 per cent, 0.8 per cent and 0.1 per cent respectively.
The Central Bank notes that “these annual reductions are slowing and it is expected that as the recovery of real estate sector continues, prices will rise in the near future.”
THE THIRTIETH publication of the RICS Cyprus Property Price Index reports that the average price of residential apartments and houses across the island rose by 1.3% and 2.3% respectively during the first quarter of 2017.
During the first quarter the Cyprus economy showed further signs of stability, with a seasonally adjusted quarterly GDP growth of 0.6% and an annual seasonally adjusted GDP growth of 3.3%. Unemployment remained at relatively high levels, on a downtrend to ca 12.8% (from the high levels of 17%).
Given prevailing economic conditions and the marginally improved confidence in the Cyprus’ banking system, there are relatively higher transactions during the quarter. Despite their non-performing loans, financial institutions have been more willing to provide access to finance and there is an increasing interest from locals.
Cyprus property prices
On an annual basis the Cyprus Property Price Index recorded increases in all cities and asset classes, with significant increases recorded in Limassol, Nicosia and Larnaca area, whilst Paphos and Paralimni have shown smaller annual increases.
Larnaca recorded the largest quarterly rise in apartment and house prices at prices at 4.6% and 2.8% respectively.
On a quarterly basis the values of holiday homes rose by 1.7% for apartments and 1.3% for houses. Limassol reported the highest increase in apartment prices (2.9%), while the highest rise in house values was recorded in Paralimni (2.1%).
Compared to the first quarter of 2016, apartment prices have risen 4.9%, house prices have risen 3.3%, while prices for offices, retail and warehouses have risen2.8%, 2.6% and 14.4% respectively.
Rental values
Across Cyprus, on a quarterly basis rental values increased by 2.5% for apartments, 2.6% for houses, 1.6% for retail, 4.6% for office and 11% for warehouses.
Compared to the first quarter of 2016, apartment rents have risen 5.5%, while those for house have risen 9.6%. Rents for retail have risen 4.3% and rents for offices and warehouses have both risen 11%.
All asset classes have shown a consecutive quarterly growth.
Gross yields
At the end of the first quarter of 2017, average gross yields stood at 4% for apartments, 2.1% for houses, 5.4% for retail, 4.3% for warehouses, and 4.8% for offices.
The parallel reduction and/or stabilisation in capital values and rents is keeping investment yields relatively stable and at low levels (compared to yields overseas). This suggests that there is still room for some repricing of capital values to take place, especially for properties in secondary locations.
Location
Type
Price (€)
Monthly
Rent (€)
Yield
(p.a.)
Monthly
Rent (€)
per sq.m
Nicosia
Apartment
109,900
394
4.3%
4.66
House
381,986
701
2.2%
2.80
Retail
520,678
2,444
5.6%
20.95
Warehouse
1,155,976
5,407
5.6%
2.70
Office
547,724
2,521
5.5%
12.61
Limassol
Apartment
113,229
452
4.8%
5.35
House
324,032
756
2.8%
3.02
Retail
464,700
2,213
5.7%
18.97
Warehouse
1,705,199
4,742
3.3%
2.37
Office
417,681
1,710
4.9%
8.55
Larnaca
Apartment
126,122
334
3.2%
3.95
House
293,066
458
1.9%
1.83
Retail
298,478
1,469
5.9%
12.59
Warehouse
1,327,007
4,168
3.8%
2.08
Office
315,187
1,268
4.8%
6.34
Paphos
Apartment
97,341
293
3.6%
3.47
House
386,679
579
1.8%
2.32
Retail
281,220
1,176
5.0%
10.08
Warehouse
1,079,757
3,507
3.9%
1.75
Office
330,663
1,053
3.8%
5.27
Famagusta/Paralimni
Apartment
83,626
306
4.4%
3.62
House
320,916
507
1.9%
2.03
Retail
215,987
721
4.0%
6.18
Warehouse
827,862
4,093
5.9%
2.05
Office
215,127
685
3.8%
3.43
Cyprus (average)
Apartment
106,044
356
4.0%
4.21
House
341,336
600
2.1%
2.40
Retail
356,213
1,605
5.4%
13.75
Warehouse
1,219,160
4,383
4.3%
2.19
Office
365,276
1,447
4.8%
7.24
(Derived from the RICS Cyprus Property Price Index for Q1 2017)
Cyprus villa charity raffle prize. Photo credit somersetlive
JOSEPH Moretti and his wife Fi are aiming to raise £40,000 to support numerous charity causes, namely donating £12,500 each to RSPCA and National Autistic Society by raffling their Cyprus villa situated in the Paphos village of Kathikas reports somersetlive.
The pair also aim to raise £15,000 from the raffle’s funds to Freddy’s Fight for Life, a charity set up to support a four-year-old with a rare cardiac tumour.
The appeal aims to raise £100,000 to fund Freddy’s surgery at Boston Children’s Hospital in the United States to remove a fibroma from his heart.
Freddy’s father Andy Vallender believes this is “the only opportunity we have to give Freddy a fighting chance at a full life”.
While discussing his incredible charitable act, Joseph Moretti said: “We bought our villa in Cyprus in 2012 and have enjoyed every summer in it since, but the time has come for us to reluctantly let it go in order to raise funds for an exciting new murder-mystery based business venture.
“Instead of selling it the traditional way, we thought we would do something a bit different, and allow anyone the opportunity to own their own property in this beautiful country – whilst helping some worthy causes in the process.”
The competition is set to run until February 1, 2018 but the closing date will be moved forward if their £40,000 goal is not met.
Situated in the Paphos village of Kathikas, the villa has three double bedrooms (two of which overlook the villa’s private pool), three bathrooms and a large, open plan ground floor with living area, dining area and kitchen. The raffle includes all indoor and outdoor furniture and furnishings, all kitchen appliances and equipment, entertainment items, bedding, crockery and glassware – in fact everything you need to start using your villa straight away.
The property is fully air conditioned, and there is also a log burner for cosy winter visits.
Despite some scepticism, Mr Moretti was quick to reassure that this a legitimate charity raffle and used the advice of multiple solicitors.
Speaking to the Cyprus Mail, Antonis Loizou FRICS said that it is not possible to raffle a house in Cyprus if the raffle was being set up in Cyprus, as a licence would not be given out. He said one person had tried it before – there was a case in 2015 – and he was simply not given a licence to do it.
Mr Loizou noted that since raffling houses is relatively new phenomenon there is not a lot of expertise on the ins and outs. “It’s a grey area,” he said. “No one has touched it yet.”
In this case, he said the raffle is being organised in the UK under British law so he did not see implications if someone in Cyprus won the villa. “I imagine it would be OK,” he said, adding that the transfer of property would probably be made as usual at the land registry as in any property transaction as long as the required fees were paid.
For a chance to win a villa and support a number of charitable causes can visit their website at: http://www.winacyprusvilla.co.uk/.
Alternatively, entrants can send a letter or postcard with the answer to: Win a Cyprus Villa, 2 Hector Stones, Woolavington, Somerset, TA7 8EG.
CYPRUS is the seventh most popular European country for Britons looking to relocate or buy a second home, figures from property website Rightmove suggest.
The most popular area in the country is Paphos, followed by Famagusta, Limassol, Larnaca and Nicosia.
“A great climate in a gorgeous setting, affordable flights and relatively close to the UK – it’s no wonder we see almost 190,000 monthly searches for property in Cyprus every month at Rightmove. With almost 76,000 average monthly searches, Paphos is one of the most popular areas by far, and despite having some of the highest average enquiry prices Limassol still sees around 20,000 searches a month,” Christopher Please from Rightmove Overseas commented.
Only 5,146 people were interested in buying property Nicosia in the past year.
According to Rightmove, most inquiries were for houses in Limassol, 55 per cent, but in the other regions apartments were more popular, with Nicosia leading the list. 72 per cent of potential buyers were looking for flats in this region.
The average asking price was highest for Limassol, where property prices soar, with €329,431, and the lowest in the Famagusta area, €127,855.
Spain is the most popular European country, the research found. More than 2.5 million searches for properties in Spain are made from the UK every month.
France is the second most searched-for location in Europe by people using the website.
Rightmove, whose findings were based on searches made over the past year, said Italy is the third biggest hotspot, followed by Portugal.
Searches for properties located in sunny Spain are particularly popular with people living in Glasgow and Liverpool, the website found.
Meanwhile, properties in France were found to attract particular interest from people living in Cardiff, London and Bristol.
Alicante is the most searched-for property destination in Spain, while Nice was identified as the most searched-for resort in France on Rightmove.
The top ten on the list are Spain, France, Italy, Portugal, Ireland, Greece, Cyprus, Germany, Malta and Turkey.
CYPRUS fell ten places to number 16 in the July 2017 edition of the ‘Top of the Props’ chart published by the property portal TheMoveChannel.com, accounting for 0.32 per cent of on-line searches on the property portal.
According to the property portal, the USA retained the top spot accounting for 6.93% of enquires with Spain and Portugal retaining their second and third places accounting for 6.12% and 1.87% of enquiries during July.
Commenting on Cyprus’ performance TheMoveChannel.com Director Dan Johnson said that: “despite the country slipping down the Top of the Props charts, enquiries remain 22 per cent higher in the three months to July than they were in the three months to January 2017. The island’s tourism sector had record year in 2016, with arrivals expected to rise another 5 per cent this year.”
The top 20 standings in the July 2017 edition of the ‘Top of the Props’ chart follows:
MOODY’S Investor Services said that they expect new bank loans at the end of 2017 to exceed the level of 2013; the year the Cypriot banking system was resolved as part of Cyprus’ bailout by the European Support Mechanism and the International Monetary Fund.
Citing a survey by the Cyprus Central Bank, Moody’s said that the increase is being driven by accelerating economic growth, an improving labour market that increased business and consumer confidence and a gradual recovery of the Cyprus property market.
It added that building permits issued in the first four months of this year reached the highest level since the 2013 crisis.
The survey reported that new loans for the first six months of this year excluding debt restructuring totalled €1.6 billion or 67 per cent of the new loan volume for the whole of 2016.
Moody’s said that the increase in new loans is expected to help banks increase their revenues and support their capacity to further write-off bad loans thus improving their balance sheets.
In a second report Moody’s warned that the Cypriot bank’s underperformance in the first quarter of the year in meeting loan restructuring indicators set by their supervisor is a credit negative, adding that the overall improvement in asset quality has been so far “lethargic”.
Moody’s said that “the underperformance is credit negative for Cypriot banks because it will lengthen the time that banks need to rehabilitate loan books and strengthen balance sheets, and may create a need for additional provisions.”
It added that “although banks for the past six quarters have exceeded their target in proposing sustainable solutions, they have encountered difficulties in finalising solutions.
“For instance, borrowers may fail to submit timely and adequate income information, discussions may become protracted, or, in some cases, borrowers change their minds on an initially agreed restructuring offer. In terms of curing early arrears, as measured by the percentage amount of loans that were 31-90 days in arrears at the beginning of the reporting quarter but which cured by the end of the quarter, banks reported their greatest underperformance on record”.
THE CYPRUS Central Bank’s ‘Home Price Index’ reports that home prices recorded the third consecutive quarterly rise (0.3 per cent) during the first quarter of 2017.
