Cyprus apartment rental prices rise in most major cities

Nigel Howarth
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Cyprus apartment rental prices rise in most major cities

Rental prices for “standard apartments” in Cyprus saw mostly upward movement between August 1, 2025, and October 1, 2025, according to a recent study conducted by consulting firm Perprice.

The research focused on one, two, and three-bedroom standard apartments across the country’s four largest cities: Limassol, Nicosia, Paphos, and Larnaca.

For the purposes of the study, “standard apartments” refer to residential units under 200 square metres that are not penthouses, are not located in luxury high-rise developments, do not have sea frontage, and do not include swimming pools. These types of properties represent up to 40 percent of the housing market nationwide, making them a key indicator of broader rental trends.

The findings revealed that average rental prices increased across most cities, mirroring price patterns seen across the wider residential rental market. The only exceptions were three-bedroom units in both Limassol and Larnaca, where declines were recorded.

Paphos saw the most significant rise in average rental prices, increasing by 4.8 percent during the two-month period, from an average of €1,178 to €1,234.

Nicosia recorded a moderate increase of 1.4 percent, with prices rising from €1,008 to €1,022.

Larnaca experienced a marginal change, moving from €1,125 to €1,126.

Limassol was the only city to register an overall decline, with average prices falling by 1.9 percent, from €1,969 to €1,931.

City-by-city rental prices breakdown

Nicosia – All apartment types recorded slight increases. One-bedroom units rose to €687, two-bedroom units to €1,001, and three-bedroom units to €1,336. The supply of available rentals slightly decreased from 1,705 to 1,693.

Limassol – The city saw mixed results. One-bedroom apartments rose to €1,409 and two-bedroom units climbed to €1,981. However, rent for three-bedroom apartments fell sharply by 7.7 percent to €2,197. The number of listings remained nearly stable, rising to 2,524.

Paphos – Two and three-bedroom apartments recorded notable increases, rising to €1,207 and €1,511 respectively. One-bedroom units saw a slight decrease, falling to €882. Rental availability declined, dropping from 335 to 298 units.

Larnaca – One and two-bedroom apartments saw minor increases, rising to €882 and €1,163 respectively. Meanwhile, three-bedroom units dropped to €1,256. The total number of apartments for rent increased from 491 to 542.

The report notes that the fluctuations may be seasonal and do not necessarily indicate long-term trends in the country’s rental market.

Impact of increasing prices

The sharp rise apartment rental prices worsens the shortage of affordable housing. Demand is exceeding supply, making it increasingly difficult for residents to secure suitable accommodation. At a land development conference in March 2025, Interior Minister Constantinos Ioannou noted that geopolitical tensions, inflation, higher construction costs, rising interest rates and strong demand from foreign workers have further restricted housing availability for locals.

To address the issue, the government has proposed removing apartment quota limits in tourist zones and reducing minimum apartment sizes to create more units. A new housing scheme to encourage mixed-use developments in commercial areas has also been introduced to support workers and ease pressure in urban centres. However, these measures are expected to take time to show results.

In the meantime, affordable rentals remain limited, competition for vacancies is intense, and landlords have become more selective; sometimes increasing rents and scrutinising potential tenants more closely, including their income and family situation.

 

Cyprus delays vote on foreign investment screening bill

Nigel Howarth
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1
Cyprus delays vote on foreign investment screening bill

The Cypriot Parliament has postponed for one week the vote on the bill establishing a national framework for screening foreign direct investments, following a request from AKEL MP Aristos Damianou.

The MP argued that several aspects of the proposed legislation needed further examination before being put to a final vote in the Plenary.

The Chair of the House Finance Committee, DIKO MP Christiana Erotokritou, agreed to the postponement on the condition that the bill not be returned to the committee for further discussion.

Foreign investments in the property market

The bill was forwarded to the Plenary accompanied by three AKEL amendments aimed at placing additional checks on foreign involvement in the property sector –  point of concern throughout nearly three years of committee deliberations.

The first amendment requires the competent authority to consider whether a foreign investment could create imbalances in the real estate market or affect housing availability. The proposal comes after stakeholders in the property sector requested exemptions for specific property categories, a position the government rejected on the grounds that EU rules do not allow such exclusions.

The second amendment calls for examining whether the target company operates in property management and whether such activity could have implications for public order or national security. A third amendment seeks to ensure that the impact of the investment on labour and environmental standards is taken into account.

In a statement, AKEL urged parties to back the amendments, arguing they are necessary to prevent “uncontrolled acquisition of land and property by foreign investors.”

The bills’ three years in the making

The bill was originally tabled in September 2022, amid interest from the US-based investment fund Lone Star in acquiring the Bank of Cyprus. After that bid was withdrawn, the legislation lost momentum, re-emerging in revised form earlier this year. Cyprus and Croatia are the last EU member states yet to establish a formal FDI screening mechanism.

Scope and implementation

The bill establishes a system requiring foreign investors to notify authorities if their investment falls within strategic sectors or could affect national security or public order. A minimum investment threshold of €2 million is included, alongside provisions for penalties, conditions, and post-investment review.

Although a requirement for pre-investment notification within a 10-day window was not adopted, the authorities will retain the power to review investments for up to five years if they were subject to mandatory notification but were not disclosed.

The law is scheduled to come into effect on 2 April 2026.

Jointly-owned buildings: Cyprus’ controversial bill under fire

Nigel Howarth
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0
Jointly-owned buildings: Cyprus’ controversial bill under fire

Cyprus’ plan to overhaul how jointly-owned buildings are managed is facing strong resistance from the country’s five District Local Government Organisations (DLGOs) argue the proposed law would impose duties beyond their remit.

In a memorandum submitted to the Standing Committee on Internal Affairs, the DLGOs said they oppose taking responsibility for registering and supervising management committees for shared buildings. They warned the process is complex and resource-intensive, and that they are unprepared to assume such a role without proper consultation or infrastructure.

(Earlier this week, the chair of the Standing Committee on Internal Affairs strongly criticised the Interior Ministry for drafting the jointly-owned buildings bill without consulting District Local Government Organisations (DLGOs), the very bodies expected to implement the new responsibilities.)

The bill, currently under discussion, seeks to regulate the management of Cyprus’ 30,000 jointly-owned buildings, addressing maintenance gaps and safety concerns. Under the proposed framework, the DLGOs would be required to oversee the committees, maintain a national register, resolve disputes, and even issue fines.

However, the organisations argue that they were excluded from drafting the legislation and that the Interior Ministry should first design specialised software, provide funding, and create a new service staffed with qualified personnel.

They also stressed that the proposed administrative fees are too low to cover operational costs. “It is impossible to assign new responsibilities without a proper structure, budget, and staff,” said the representative of the DLGO presidents.

The DLGOs already manage dangerous buildings — a duty they assumed in April 2025 — and claim they still lack clear guidance and adequate financial support for that role. They have called on the government to strengthen existing functions, such as licensing, before assigning new responsibilities.

What the jointly-owned buildings bill proposes

The proposed Management of Jointly-owned Buildings and Related Matters Law of 2023 introduces several new provisions. These include mandatory structural, mechanical, and electrical inspections by certified professionals from the Cyprus Scientific and Technical Chamber (ETEK).

The absence of such inspections has led to severe deterioration in many buildings, with incidents such as falling balconies and collapsing walls.

The law would also require management committees to set up a reserve fund for repairs and maintenance. Property owners would be responsible for paying shared expenses, including heating, cleaning, lift maintenance, electricity, and water consumption.

Additional obligations include building insurance, repair of communal areas and facilities, insulation works, and environmental upgrades. Owners would be prevented from selling their properties until they had paid all their communal fees.

Major shortfall in the bill

However, the draft bill fails to fully address he most critical issue – communal fee payments. Management Committees must have immediate and reliable access to funds to perform their core duties — including insuring the building and carrying out essential repairs & maintenance works. Without an enforceable system for prompt payment, Management Committees are effectively set up to fail.

Cyprus fast-tracked 1,300+ permits under new licensing scheme

Nigel Howarth
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2
Cyprus fast-tracked 1,300+ permits under new licensing scheme

Despite ongoing backlogs faced by the building permit authorities, new tools introduced over the past year have significantly speeded up approvals, resulting in many permits being issued.

According to Interior Minister Constantinos Ioannou, more than 1,300 urban planning and building permits for residential properties have been approved since the launch of the fast-track licensing measures introduced last October.

He added that permits have also been granted for around 217 apartment blocks, noting:

“This means that these developments will enter the housing market one to two years earlier, thereby increasing the housing supply and helping to ease the housing shortage.”

Speaking on national radio, Mr Ioannou explained that the aim of the fast-track licensing initiative is to reduce bureaucracy, boost productivity, and make life easier for citizens while addressing the housing challenge.

He clarified that under the scheme, which includes 22 measures to simplify procedures implemented by district planning authorities (EOAs), building permits for apartment complexes and semi-detached houses located on plots that do not require any exemptions are now issued automatically.

Urban planning permits are issued within 20 days, while building permits follow within 40 days.

For medium-risk apartment buildings (up to four floors and 20 units), the maximum approval period remains 40 days.

Regarding on-site construction inspections, the minister noted that these are carried out in three stages during the building process.

“For now, inspections are being conducted by EOA officials,” he said, “but soon, independent certified building inspectors, selected by lottery, will take over this role.”

Mr Ioannou stressed that this system will prevent the construction of unauthorised buildings from the outset and ensure stricter penalties for non-compliance.

Cyprus urged to overhaul its property tax system

Nigel Howarth
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0
Cyprus urged to overhaul its property tax system

Cyprus faces growing pressure to reform its property tax system as part of the government’s forthcoming tax overhaul.

Economists, including the IMF, argue that the island’s low property taxes and generous developer incentives are fuelling inequality, overheating the housing market, and damaging the environment.

Why property tax reform is needed

Cyprus collects less than 2% of total tax revenue from property, compared with an EU average of 4.7%. Fiscal experts say this under-taxation deprives the government of a stable revenue source that could support public services and infrastructure.

Property taxes are also viewed as among the least harmful to economic growth, making them a logical target for reform. A more progressive tax system would help reduce widening wealth and generational inequality.

Foreign demand fuelling housing pressures

Low taxes and generous incentives have made Cypriot real estate highly attractive to foreign investors. Demand for luxury apartments from overseas buyers has surged, pushing up prices and leaving many local residents, especially younger people, locked out of the housing market.

Countries such as Spain, Portugal, and Italy are already moving to raise taxes on foreign property purchases. Experts suggest Cyprus should follow suit and tighten its Golden Visa rules to ensure fair taxation and proper oversight.

Developers’ tax breaks under scrutiny

The housing crisis is not only about foreign demand. Property developers enjoy significant tax advantages, such as the Notional Interest Deduction (NID) that can reduce corporate tax rates to just 2.5%, and a reduced 5% VAT on new homes used as primary residences.

While the government plans to lift the corporate tax rate to 15%, it is also maintaining several incentives that mainly benefit large developers and foreign professionals. Critics warn that these policies encourage the construction of high-end properties rather than affordable homes or social infrastructure.

Time for a critical property tax review

To address the housing crisis, inequality, and economic inefficiencies, Cyprus must reassess its entire property tax and incentive framework. Policymakers should aim to:

  • Reintroduce progressive property taxation at realistic market values.
  • Tighten controls on foreign property purchases.
  • Scale back excessive developer and corporate tax incentives.
  • Redirect investment towards affordable housing and essential infrastructure.

Such changes will take time, especially as property values require updating, but they are essential for a fairer, more sustainable economy.

The bottom line

Cyprus’ current property tax regime favours developers and foreign investors at the expense of local residents and long-term economic health. A fairer, greener, and more balanced tax system could help the country tackle its housing crisis and build a more inclusive future.

This summary is based on an article by Leslie G. Manison, first published in Stockwatch. Mr Manison is an economist, specialising in macroeconomic policy analysis and international financial relations. He is a former senior economist at the International Monetary Fund, an ex-advisor in the Cyprus Ministry of Finance, and a former senior advisor in the Central Bank of Cyprus.

Consultation on jointly-owned & dangerous building bills demanded

Nigel Howarth
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0
Consultation on jointly-owned & dangerous building bills demanded

The Cyprus House of Representatives is currently examining two interconnected bills aimed at improving the regulation of jointly-owned buildings and tackling dangerous buildings.

Both pieces of legislation have drawn significant attention due to their potential impact on public safety and housing management.

Call for partner consultation

Members of the Standing Committee on Internal Affairs have urged the government to improve coordination and engage partners before proceeding.

Committee Chair Aristos Damianou strongly criticised the Interior Ministry for drafting the jointly-owned buildings bill without consulting District Local Government Organisations (DLGOs), the very bodies expected to implement the new responsibilities.

“Dialogue must come before action, especially when laws affect thousands,” he said, describing the move as “unacceptable” and warning of potential implementation delays.

To address concerns, the committee has approved a 15-day consultation period, aiming to resume detailed discussions by the end of October.

Jointly-owned buildings bill

The jointly-owned buildings bill introduces several new provisions to manage apartment complexes and shared housing units, where coordination between owners is often poor.

MP Marinos Mousiouttas of DIPA highlighted the importance of this legislation, noting that nearly 200,000 families, almost half of Cyprus’ population, live in such properties.

Key features of the bill include:

  • Mandatory management committees
  • Debt clearance certificates before properties can be transferred
  • Sinking & Emergency reserve funds
  • Mediation mechanisms for resolving disputes

Mousiouttas stated that when some owners don’t cooperate, it places an unfair burden on others or prevents necessary work altogether. “This imbalance is what the law seeks to address,” he said.

Dangerous buildings bill

The second bill, focused on dangerous buildings, aims to address long-standing issues that local authorities have struggled to manage effectively.

The proposed legislation includes:

  • Demolition of unsafe structures
  • Disconnection of utilities
  • Court-issued orders via unilateral applications
  • Registration of charges for cost recovery by local or state authorities

Mousiouttas stressed that the Ministry of Interior also plans to offer financial aid to DLGOs through local councils, enabling emergency repairs when property owners fail to act.

“Time to act”: safety and accountability in focus

“We’ve seen balconies collapse – fortunately without serious injuries,” Mousiouttas warned. “It’s time to take decisive steps to ensure public safety and prevent further accidents.”

The Committee aims to pass both bills within the current parliamentary session, signalling a strong push for reform in property legislation and building safety across Cyprus.

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