Cyprus Property Market is booming
At a length and width of just 240 by 100 km, Cyprus is just a fraction smaller than Devon and Cornwall combined, but this comparatively small island contuines to attract international buyers in ever increasing numbers. This is not just due to sunshine, great cuisine and fabulous beaches, but due to the fact that property is still affordable in many places and citizenship in an EU country can be achieved with relative ease.
Apart from the lovely wealther and the "Golden Visa" residency scheme, non-national investors in Cyprus also enjoy an advantageous tax regime, where the first 19,500 of earned annual income is tax-free, and pensions exceeding 3,450 euros are taxed at just 5%.
In February, sales transactions increased by a stunning 46%. In March sales figures rose by 29%, and in April of this year, completed sales transactions saw a 29% increase. In May of this year property sales went up by 23%, compared to the same month a year ago, according to data released by the Land Registry Offices. Cyprus is once again seen as a safe tourist destination - and safe haven for investors. An improved economic outlook for the island and steady increase in tourist numbers continue to generate price increases in the property market. Over the last year, prices for apartments rose by 7.4%.
Of the 828 sales transactions registered with the Land Registry Office, some 47.3% were for properties bought by non-Cypriots. This figure seems to suggest that the government's "citizenship by investment scheme" attracts a growing number of non-EU buyers. Having said that, the Council of Ministers recently declared a limit to the number of such citizenships to 700 per annum, which may explain the slight dip in sales transactions from April to May 2018.
The popular resorts Larnaca and Limassol saw a 5% downturn in their sales, but sales went up in the remaining districts, especially in Famagusta, where sales rose by an astonishing 108%, followed by Nicosia, where sales increased by 30%, and the ever-popular Paphos, where sales grew by 10%. Limassol's reduction in sales can be explained by the sharp increase in house prices seen so far this year. Limossol property prices went up by 14% in the last twelve months.
The deomgraphics of buyers also seems to have changed. Currently, the typical buyer is looking for quality builds and excellent locations rather than cheap-as-you-can-get property in the sun. Developers have responded to this by offering high-spec builds to high net worth buyers from abroad. The Cypriot government aimed their "Golden Visa" especially at such potential investors who can afford to spend at least 300,000 euros on a property to qualify for residency, and 2 million euros in exchange for their EU passport. This is dependent on investors not pulling out their investment for at least three full years. Since 2013, the "Golden Visa" scheme has attracted some 4 billion euros of non-EU investors' money, so this is a lucrative source of revenue for the government. The Ministers may reverse their decision, if limits on the number of citizenships handed out begin to affect sales.
For less wealthy investors there are still bargains to be had. It's still possible to find apartments for less than 100,000 and small villas costing around 160,000 euros on the outskirts of Limassol and Paphos. If you are looking to buy a property in Cyprus for less than 160,000 euros, head further inland. The southern end of Cyprus contains the Troodos Mountain range at its heart, where village life is far more tranquil and far slower than in the busy resort towns of Nicosia, Paphos, Limassol and Famagusta.
