Cyprus building permits soar 21% led by new homes

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Cyprus building permits soar 21% led by new homes

Cyprus saw a sharp rise in building activity in May, with the number of authorised building permits climbing by 21.1% year on year.

A total of 735 building permits were authorised during the month, according to the Cyprus Statistical Service. The permits had a combined value of €428.2 million and covered 352,126 square metres of floor area. They also provide for the construction of 1,847 dwelling units.

The figures point to a strong start to the year for Cyprus’ construction sector. Between January and May, authorities issued 3,650 building permits, up from 2,764 during the same period in 2025. That represents a 32.1% increase in the number of permits.

The value of approved projects also rose, increasing by 43.9% to €2.10 billion. The total permitted area grew by 43.1% to 1.70 million square metres. At the same time, the number of planned homes jumped by 63.7% to 8,978 units.

Cyprus building permits May 2026

Apartment development drives housing growth

Residential buildings were the largest category during the first five months of 2026, with 2,684 permits issued. That was 31.3% more than the 2,044 permits recorded in the same period last year.

Residential projects also accounted for much of the increase in permitted floor space. The total reached 1.54 million square metres, compared with 947,511 square metres a year earlier. This represents a rise of 62.8%.

The value of residential building permits rose by 61.6% over the same period, reaching €1.79 billion. By comparison, the value of permits for non-residential buildings fell by 28.8% to €196.5 million.

Apartment blocks were a major part of the increase in planned housing. Permits covered 6,667 units in residential apartment blocks between January and May, compared with 3,497 in the same period of 2025.

That represents a 90.6% increase in the number of units planned in residential apartment blocks. Single houses increased more modestly, with 1,469 units approved compared with 1,369 a year earlier, while buildings with two housing units rose 20% to 547 units.

Wider construction activity also rises

The increase was not limited to residential development. Permits for civil engineering projects rose by 26% to 213 during the first five months of the year.

There was also a substantial increase in plot division activity. The number of permits reached 343, up 62.6% from 211 a year earlier. Road construction permits rose from 32 to 80, an increase of 150%.

The value of civil engineering projects increased by 39.9% to €85.8 million. The value of plot division projects almost doubled, rising 99.2% to €23.4 million. Road construction values increased by 66.4% to €4.1 million.

Source: Cyprus Statistical Service, Building Permits: May 2026, published 16 September 2026.

The Cyprus non-performing loans crisis is over – or is it?

Nigel Howarth
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The Cyprus non-performing loans crisis is over – or is it?

Cyprus has made major progress in tackling its non-performing loans, but the private debt problem is far from over, according to a new article published on The CBC Blog.

The article describes the fall in non-performing loans as a clear banking success story. Cyprus’ banks are now in a much stronger position, with key indicators closer to the European average. Stronger provisions and more resilient capital have also helped to stabilise the banking sector.

That progress, however, came at a heavy cost. Years of loan restructurings, asset sales, regulatory pressure and institutional reforms were needed to clean up bank balance sheets.

Cyprus non-performing loans fall, but private debt remains

The next challenge lies beyond the banks. Vulture funds now hold most of Cyprus’ troubled loans (€16.702bn at the last reckoning in April), with many still unpaid. Although these loans have left bank balance sheets, they have not left the economy.

This matters for the property market. Debt recovery, collateral sales and property portfolios held by credit-acquiring companies can still affect property values and market activity. For some borrowers, financial problems have been resolved. For others, the debt has simply moved from one creditor to another.

The article also highlights the debate over Cyprus’ foreclosure framework. It argues that an effective system for recovering secured debt is essential, while recognising the need to protect borrowers facing genuine financial hardship.

For the property sector, the impact could remain significant as lenders and vulture funds seek to recover value from secured assets. The pace and scale of these sales will be important for market conditions, particularly where properties remain tied to long-running debt disputes. A more effective resolution process could help unlock assets and provide greater certainty for buyers and investors. At the same time, policymakers face the difficult task of balancing faster debt recovery with adequate safeguards for financially vulnerable borrowers and homeowners.

The key lesson is simple: the fall in non-performing loans does not mean Cyprus has solved its private debt problem. Banks may have closed their crisis chapter, but for many borrowers, the story is still being written.

Why Cyprus needs a new regulatory framework for property developers

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Why Cyprus needs a new regulatory framework for property developers

Buying a property is one of the biggest financial decisions most people will make. It is therefore reasonable for buyers to want to know who they are dealing with, whether that professional meets clear standards, and whether they operate within a robust system of oversight and accountability.

This is the regulatory gap that the Cyprus Property Developers Association (CPDA) seeks to address through the formal recognition and regulation of the land development profession.

This does not mean property development currently takes place without rules. A development project is already subject to a wide range of planning, building, environmental and other legal and regulatory requirements.

What is missing is a specific and unified framework governing the professional activity of the land developer itself. This would establish who can practise, what requirements they must meet, how they are supervised and how they are held accountable.

Filling this gap is an important next step for a property market that has changed significantly. Buyers’ expectations are higher, while the responsibilities placed on property professionals have also grown.

What is being proposed?

At the heart of the CPDA’s proposal is a registration and oversight system for individuals and companies professionally involved in land development for commercial purposes.

A central role would be given to a proposed Registration and Control Council for Land and Building Developers. Among its responsibilities would be maintaining an official register and overseeing registered professionals.

Registration criteria would be objective, transparent and proportionate to the nature and responsibilities of the profession. The aim is not to create a closed profession. Instead, it is to establish a common and reasonable standard of professional competence and responsibility across the market.

The criteria would include the structure, staffing and operational capacity of businesses. They would also cover cooperation with registered consultants, technical competence and proven professional experience.

Common rules can also benefit developers themselves. They can protect businesses that operate responsibly, promote fair competition and help raise the credibility of the property sector as a whole.

The proposed status of probationary member would also keep the profession open to new entrants. Those without enough experience for full registration would be able to enter the sector and gain the required experience before securing full registration.

Buyer protection at the heart of the proposal

A key objective of the Association’s initiative is to strengthen buyer protection.

An official register would allow buyers to check whether the professional they are dealing with is registered, meets defined criteria and operates under clear rules and obligations.

This would give buyers an additional layer of security and information during a transaction that, for most people, represents one of the most important financial decisions of their lives.

Protection, however, should not stop at registration. The proposed framework would provide for ongoing supervision of registered professionals, clear rules on professional conduct and a process for submitting and investigating complaints.

Where breaches are identified, the framework would also allow for the relevant sanctions to be imposed.

This would create a clear system of accountability. Buyers would not only know who they are dealing with, but also where to turn if a problem arises.

That added protection could strengthen buyers’ rights while helping to build greater trust and confidence across the property market.

From proposal to legislation

The push to regulate the land development profession began in 2025. The Association of Property Developers then prepared a draft bill following consultation with relevant stakeholders and with support from its legal advisers.

The draft was submitted to the Interior Minister in May 2025. A dedicated working group was subsequently established, bringing together officials from the Department of Lands and Surveys and representatives of the Association.

The working group held a series of meetings to examine and improve the proposed framework. The draft legislation was then forwarded to the Law Office for legal and technical review.

The next step is now to complete the process without further delay. The aim is for the bill to be submitted to the House of Representatives, where parliamentary scrutiny can begin.

For the Association, this would be the key step in turning the proposal into a modern, practical and workable legal framework.

A reform aimed at greater confidence

Formal recognition of the profession would represent a significant reform for the property market. It could help improve standards, strengthen confidence and support the orderly development of the sector.

The objective is not to create more bureaucracy. It is to establish clear rules, higher professional standards and effective oversight.

Ultimately, the goal is straightforward: greater security for property buyers within an open, competitive and trusted market.

By Mersina Isidorou, Director General, Association of Property Developers

(Translated from a press release published by the Cyprus Property Developers Association)

Cyprus housing schemes win praise, but experts warn of limits

Nigel Howarth
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Cyprus housing schemes win praise, but experts warn of limits

Two new housing schemes introduced by Cyprus’ Interior Ministry have received a broadly positive response from property and construction experts, although they warn that the measures alone will not solve the country’s housing affordability crisis.

The schemes aim to make home ownership easier by using existing family property, state-owned land and unused planning capacity. However, their success will depend on how they are implemented and whether they form part of a wider, long-term housing strategy.

Who qualifies for the new Cyprus housing schemes?

The state-plot scheme is aimed at Cypriot citizens who form a household. Eligible households include couples with children, couples without children and single-parent families. Applicants must also meet the scheme’s income and other eligibility requirements.

Priority can depend on factors including family circumstances and where applicants live. Large families, particularly those with four or more children, receive additional priority where applicants are otherwise equal. The scheme focuses on rural communities, with plots of around 325 to 371 sq m being made available.

The plots will be offered at 25% of their market value, although applicants will also have to meet the costs associated with subdivision and infrastructure. Successful applicants must build a home for their own use, with the permitted usable area capped at 150 sq m under the latest ministry clarification.

The government expects around 570 state-owned plots to be allocated during the initial phase, with further subdivisions planned in communities that have expressed interest. Mountainous, remote and disadvantaged areas are expected to receive particular attention.

The additional-home scheme applies to owners of existing homes who want to create another residential unit for a child or grandchild, subject to the scheme’s conditions. The additional home can be created within the existing building, through an extension or additional floor, or by using available space on the plot.

The additional dwelling can generally have up to 150 sq m of buildable area, rising to 180 sq m on larger plots where the relevant conditions are met. The scheme can apply even where the existing property has exhausted its permitted development density. A 10-year restriction on transferring the additional home will apply, apart from inheritance cases.

ETEK backs the measures

ETEK president Constantinos Constanti described the measures as a positive step towards addressing one of Cyprus’ most serious social challenges.

He said access to decent and affordable housing should be treated as both a social good and a right, given its importance to quality of life and social cohesion.

Constanti welcomed the Interior Ministry’s move towards a more coherent housing strategy. He said policies should not simply be announced but regularly monitored and assessed so they can be adjusted according to their results and changing social needs.

He also highlighted the potential for housing policy to support rural communities by strengthening village centres, retaining residents and attracting new populations.

The additional-home scheme could help make better use of Cyprus’ existing housing stock, he said. However, it should be supported by planning and architectural safeguards to prevent excessive density, changes to neighbourhood character and pressure on infrastructure.

Loizou warns of property windfalls

Ask Wire co-founder and CEO Pavlos Loizou said Cyprus’ housing crisis is largely an affordability problem caused by a mismatch between supply and demand.

He pointed to continued price growth, with house prices rising 7.5% year on year in the first quarter of 2026, while apartment prices increased by 10.8%.

Loizou believes the new schemes could reduce construction costs, particularly where families can build an additional home without purchasing more land.

However, he warned of possible impacts on neighbouring properties, including greater density, overshadowing, parking pressures and additional demands on local infrastructure.

He also questioned whether the schemes provide equal treatment to property owners. A family able to use the additional development rights could gain a significant increase in property value, while a similar neighbouring property might receive no comparable benefit.

Loizou is also concerned that state support could eventually become a private windfall. Homes built using discounted state land may eventually be sold, while the additional-home scheme has a 10-year transfer restriction.

He argued that the government should consider long-term resale restrictions, state buy-back rights, continued state ownership of land or repayment of part of the subsidy when a property is sold.

The objective, he said, should be to ensure subsidised homes remain affordable for future families rather than simply helping the first buyer.

KPMG: Not all households will benefit

KPMG Deal Advisory senior manager and property specialist Marios Kapnisis also welcomed the schemes but warned that they will not benefit all households equally.

The measures mainly assist people who already have access to family property or can afford to finance construction. Lower-income households and those without family assets may therefore continue to struggle, particularly if they need affordable rented accommodation.

Kapnisis said the affordability problem is more complex than simply looking at housing supply and demand.

Policymakers must consider where homes are located, whether they are genuinely available and whether households can afford to buy or rent them.

Demographic and economic changes must also be taken into account, including positive net migration and Cyprus’ strategy of attracting international businesses, investment and skilled workers.

Economic growth can create additional demand for housing, particularly in major urban centres. Without matching investment in homes and infrastructure, successful economic policies could therefore add to housing pressures.

Kapnisis called for a broader strategy combining planning reform, better use of existing housing, more affordable rental homes and targeted assistance for households facing the greatest difficulties.

A long-term solution is needed

The three experts broadly agree that Cyprus’ new housing schemes are a useful intervention, but not a complete answer to the affordability crisis.

The challenge is to ensure that public support creates lasting benefits rather than temporary increases in property ownership or values.

A successful housing strategy will need to combine home ownership with affordable rental options, careful planning, infrastructure investment and measures that preserve affordability over the long term.

For Cyprus, the key test will be whether the new schemes can deliver homes that remain affordable not only for today’s beneficiaries, but also for the families that will need them in the future.

(Translated an summarised from an article in StockWatch)

Cyprus homes bonanza as state plots offered at 75% discount

Nigel Howarth
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Cyprus homes bonanza as state plots offered at 75% discount

Families in Cyprus are being offered a major boost in the race to secure an affordable home, with state-owned plots set to be sold for just a quarter of their market value.

The government has unveiled two new housing schemes designed to help younger families get on the property ladder and increase the supply of homes.

One of the measures could prove particularly attractive to homeowners with adult children or grandchildren. It will allow eligible families to build an additional home on their existing property, even where the permitted building capacity has already been used.

The announcements were made by Interior Minister Konstantinos Ioannou on Wednesday.

And there is more to come, with around 570 state-owned plots expected to be allocated across Cyprus to people who qualified under the first phase of the programme.

Homeowners could build an extra property

Under the first scheme, owners of existing homes will be able to create another residential unit for a child or grandchild, subject to specific conditions.

The extra home could be built inside an existing property, added as an extension or new floor, or constructed using unused space elsewhere on the plot.

The rules could open the door to a valuable new option for families struggling to find affordable housing.

The additional property can generally have up to 150 square metres of buildable floor space. On larger plots, the limit can rise to 180 square metres if the relevant conditions are met.

There will also be some flexibility around parking requirements.

However, families will not be able to immediately sell the new property. A 10-year restriction on transferring the home will apply, apart from cases involving inheritance.

The government says the scheme will allow families to make better use of property they already own while reducing the cost of providing a home for younger generations.

State land to be sold at huge discount

The second scheme could deliver an even bigger financial incentive.

Eligible applicants will be able to obtain state-owned plots at just 25% of their market value.

The scheme is aimed at Cypriot citizens under 45, with families with children, childless couples and single-parent families all potentially eligible.

Income, family circumstances and other conditions will also be taken into account.

The government says the measure is intended to help young households on low and middle incomes build their own homes.

It is also designed to breathe new life into rural and mountain communities by encouraging families to settle in areas outside the main urban centres.

Applications will be made through Community Council presidents, who will forward preliminary requests to the appropriate District Local Government Organisation (DLGO)

The authorities will then assess the applications and identify suitable plots.

More plots could be released

The initial allocation of around 570 plots is not expected to be the end of the programme.

Further plot divisions are planned in communities that have already expressed interest. Mountain, remote and disadvantaged areas will receive particular attention.

The government is also pressing ahead with a much wider programme to increase Cyprus’s housing supply.

Around 460 homes are being planned on state land, with the properties intended to provide affordable rents for young people and families.

An architectural competition for the developments has already been completed, with standard designs selected.

Thousands have already received housing support

The latest announcement comes after substantial government spending on existing housing schemes.

A programme for young people and young families aged up to 41 has supported 700 beneficiaries, with €26 million spent.

A further 1,075 applications were approved between 2023 and 2026 under schemes covering mountain, border, disadvantaged and rural areas. These programmes involved total spending of €43 million.

Meanwhile, more than 6,500 applications were approved through housing schemes for displaced people during the same period.

The total value of that support reached €168 million.

Thousands more homes could be coming

There is also a potentially significant increase in the wider housing supply.

Through planning incentives and the Built to Rent programme, the Interior Ministry expects more than 4,100 new residential units to be added to the market over the next three years.

Of these, 1,142 are expected to be offered for affordable purchase or rent.

The government also estimates that more than €22 million could flow into the Cyprus Land Development Corporation’s Affordable Housing Fund, helping finance around 250 additional homes.

Plans for student and co-living accommodation are also moving forward.

Fast-track approvals could cut waiting times

Cyprus is also trying to tackle one of the biggest obstacles to new housing: lengthy development approvals.

By the end of August, 2,533 detached and semi-detached homes had been approved through the fast-track system within 40 working days.

Another 1,242 apartment blocks and townhouse developments had been approved within 80 working days.

The developments cover more than 15,000 families.

According to the government, faster approvals could allow many of those households to move into their homes around 18 months earlier than under previous processes.

The latest measures form part of a broader push to increase the number of homes available, make better use of state and private land and speed up development.

For younger Cypriot families facing rising housing costs, the combination of heavily discounted land and new opportunities to build could prove a significant boost.

EU affordable housing act will crack down on Airbnb

Nigel Howarth
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EU affordable housing act will crack down on Airbnb

The European Union is preparing to give cities and regions new powers to curb short-term rentals such as Airbnb as part of a wider drive to tackle soaring housing costs; the measures form part of the European Commission’s Affordable Housing Act.

Under the proposed framework, EU-wide rules will help determine when an area is facing serious housing stress. National, regional and local authorities would then have legal backing to introduce targeted measures to address shortages.

Energy and Housing Commissioner Dan Jørgensen said short-term rentals were not the main cause of Europe’s housing crisis. However, he said they were making the problem worse in some of the bloc’s largest cities and tourist hotspots.

“Short-term rentals are not the cause of Europe’s housing crisis,” Jørgensen said. “But it’s very clear that in some parts of Europe, especially in some of our biggest cities, they are aggravating the problem.”

How the Affordable Housing Act would work

The framework has two main elements. One focuses on legislation, while the other aims to address the underlying shortage of homes.

EU regulation

The proposed EU regulation would establish a common method for identifying “areas under housing stress”.

Authorities would consider factors such as the gap between local incomes and property or rental prices. Areas where housing costs continue to move further beyond what local residents can afford could qualify.

Commission recommendation

A separate Commission recommendation would encourage national governments to increase the supply of public, social and student housing.

The aim is to tackle the structural shortage of homes rather than relying solely on restrictions.

New safeguards for short-term rental restrictions

The proposed rules would also place limits on how local authorities use their new powers.

If a city or region wants to restrict non-primary housing uses, such as preventing a property from being listed on an online booking platform, it would have to meet several conditions.

  • Housing stress must be demonstrated. Authorities would need to show an ongoing negative impact on housing availability or affordability for at least three years.
  • Restrictions must be proportionate. Local governments would have to demonstrate that less restrictive measures would not be effective in protecting the long-term residential housing supply.
  • Restrictions would be time-limited. Measures would need regular reviews and could remain in place for no more than five years.
  • Building homes remains essential. Restrictions on short-term rentals could not become a permanent replacement for constructing or renovating housing.

Housing crisis needs more than Airbnb restrictions

The Affordable Housing Act is not intended to provide a single solution to Europe’s housing crisis.

Jørgensen said the bloc also needed to address investment, planning rules, housing supply and pressure on existing homes.

The legislation follows comments by Commission President Ursula von der Leyen almost a year ago, when she described Europe’s housing shortage as a “social crisis” and pledged action.

Jørgensen described the new act as a key step for cities, regions and countries seeking immediate solutions for the areas and people most affected.

But he acknowledged that much more would be needed.

“The housing crisis is a complex issue,” he said, pointing to the need for action on investment, simpler rules, new supply and pressure on existing housing stock.

For property investors and short-term rental operators, the proposed rules could mark a significant shift in how European cities regulate holiday and temporary accommodation.

For renters and prospective homeowners, the bigger question will be whether returning homes to the long-term market can make housing more affordable.

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