After a year or so of disruption due to the pandemic, how has the property market fared in Cyprus? We take a look at the latest data and trends in our Cyprus property market update…
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General property update
Things are looking up for Cyprus’ property market. After a slow year in 2020 due to the pandemic, demand for Cypriot property is rising. This is largely thought to be down to low interest rates and government relief measures.
According to the Central Bank of Cyprus, property prices rose across the country by 0.91% year-on-year in the first quarter of 2021. Other research by the Department of Lands and Surveys revealed that the total property sales in Cyprus rose significantly by 36.2% YOY in the months leading up to May 2021.
After a slow year in 2020 due to the pandemic, demand for Cypriot property is rising.
Despite an overall rise in prices nationwide, the extent of this increase varies across the country.
Interestingly, there was also variation between house prices and apartment prices. In Nicosia, the country’s capital, apartments rose by 2.2% YOY in Q1, but house prices fell by 0.9%. Larnaca saw a similar trend, with apartment prices rising by 6% and house prices falling by 0.8%. In Limassol, a popular destination for overseas buyers, both apartment and house prices rose – by 3.4% and 2.7% respectively. Paphos saw the opposite trend, with apartment prices falling by 3% and house prices falling by 1.6%.
Unsurprisingly, domestic sales made up the majority of total sales: the number of Cypriots buying property in Cyprus rose by a huge 73% YOY. Sales to foreigners fell by 8%.
Will these trends last?
Experts have said that while government support lasts, Cyprus’ property market is likely to remain stable, particularly in the areas of Nicosia and Limassol. However, areas that are more reliant on tourism and foreign buyers, like Paphos, may continue to see reduced demand and a fall in prices.
Predictions on how the Cypriot economy will fare this year vary between an increase of around 3% and 5%, which is a positive after the 5.1% contraction last year.
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The rental market
The general trend appears to be that rental yields are falling. Data from RICS revealed that average gross rental yields for apartments in Cyprus were 4.8% in 2020. Although this is a fall from the 5% in 2019, it is still higher than 2018, 2017 and 2016. Similarly for houses, gross rental yields fell by 0.1% in 2020 compared to 2019 but were still higher than the three years prior.
The monthly rent of apartments in Cyprus fell by 0.6% YOY in Q1 2021, whereas the rent for houses increased by 2.6%.
The general trend appears to be that rental yields are falling.
Will these trends last?
Some experts have predicted that rents will fall in almost all major Cypriot cities by the end of the year.
Travelling to Cyprus for property viewings
If you want to travel to Cyprus to view properties, here’s what you have to do:
Flying to Cyprus
The UK is currently in Cyprus’ red category, but don’t worry, that’s not equivalent to our red list. This means that if you are not fully vaccinated then you must undergo a PCR test within 72 hours prior to departure and provide proof of a negative result. You will then have to do another PCR test when you arrive at Larnaca or Paphos airports. However, if you have been fully vaccinated you are not required to take a PCR test before departure or on arrival.
All passengers, whether vaccinated or not, need to complete a Cyprus Flight Pass before flying. You can find this on the Cyprus Flight Pass website.
Returning to the UK
IMPORTANT: England’s rules around international travel are changing on the 4 October. The following information is for travel prior to 4 October. For information on travel after this date, visit the GOV.uk website.
Cyprus is on the UK’s amber list. Before you arrive in England:
- Take a COVID-19 test (this can be either a PCR test or lateral flow but must be taken no more than 3 days before you depart from Cyprus)
- Book your day 2 test (to take on or before your second day back in England)
- Complete a passenger locator form and declare that you have been fully vaccinated (note, you will need proof!)
You will need to do these things whether you have been fully vaccinated or not. However, if you have not been fully vaccinated, you will also need to quarantine at home, or in the place you are staying, for 10 days. You will also need to take a day 8 test.
