DEMAND for property has risen dramatically in the past 12-18 months, and now analysts are predicting massive increases in land and property sales once the island joins the European Union (EU).
Estate agent Antonis Loizou describes the present situation as “a great time to invest in property in Cyprus”. He points to imminent EU accession and Cypriots looking to invest in alternatives to the failed Cyprus Stock Exchange as the main factors fuelling the rise in demand.
The head of the Land Survey Department, Andreas Christodoulou, said that in recent years the price of property in developed areas has shown an average annual increase in value of between six and ten per cent, with ten per cent a maximum reached only by the most highly developed areas.
In the past year alone, however, beachfront property value has soared by up to 20 per cent.
Christodoulou also believes that the collapse of the Stock Exchange is a contributing factor.
“People are choosing to invest in property and land rather than speculating on the stock exchange, as they perceive it as a safer investment that still provides a good return,” said Christodoulou. “Subsequently, demand has risen by around 40 per cent.”
He said most of the demand is from Cypriots on the island, although an increase in foreign buyers has also been noted. Current regulations limit the level of investment by potential buyers from abroad; these include having to obtain permission from the municipality for purchase, and a restriction on ownership of one property per foreign family.
Loizou says that situation that will change once Cyprus joins the EU and these restrictions are lifted. He predicts that the volume of land and property sales will double on accession to Europe as foreign property developers enter the market.
“At present the property and land market stands at around £200m,” said Loizou. “I expect that to rise to approximately £400m once the restrictions have been lifted and Cyprus completes its accession into Europe.”
Currently, between 70 and 80 per cent of demand from foreign buyers in Cyprus is focused on the Paphos area, with around 20 per cent in Limassol and the rest of the market spread between the Pervolia area of Larnaca and Paralimni.
Of those buying property in Cyprus 70 per cent are British buyers, with the balance made up largely of people from the former Yugoslavia, Russia and Israel.
“The market for shops and offices is likely to see a downturn over the next year and possibly two, with residential properties in the cities maintaining steady growth,” Loizou said. “However, the demand for beachfront property and the potential for investment by foreign property developers is still huge.
“At present Cyprus welcomes around three million visitors per year: with foreign investment and development of the market that figure could rise to four million.”
The Cyprus Mail is the only English-language daily newspaper published in Cyprus. It was established in 1945 and today, with its popular and widely-read website, the Cyprus Mail is among the most trusted news sites in Cyprus. The newspaper is not affiliated with any political parties and has always striven to maintain its independence. Over the past 70-plus years, the Cyprus Mail, with a small dedicated team, has covered momentous events in Cyprus’ modern history, chronicling the last gasps of British colonial rule, Cyprus’ truncated independence, the coup and Turkish invasion, and the decades of negotiations to stitch the divided island back together, plus a myriad of scandals, murders, and human interests stories that capture the island and its -people. Observers describe it as politically conservative.
