The Cyprus real estate market can be divided into two groups of demand. The major urban centres of Nicosia, Limassol and Larnaca are mainly supported by local demand, while Paphos and Famagusta are mainly supported by foreign demand.
The market is further segmented in three main sectors, being the residential, retail and office sectors, with the primary emphasis being upon the residential sector as the island’s topography and geography appeal largely for residential utilization.
For the period January-November 2016, Limassol experienced the biggest increase in value (44,2%) compared to the corresponding period of 2015. An increase in value was also exhibited in Nicosia (11,0%). On the other hand, Famagusta experienced the biggest reduction in value (-14,8%) between 2016 and 2015, while a fall in value was also observed in Larnaca and Paphos with a decrease of 7,6% and 3,7% respectively.
Considering the total areas (m2) for building permits, Limassol witnessed the biggest increase (45,3%) compared to the first 11 months of 2015. Area for building permits in Nicosia, Famagusta and Larnaca also increased by 9,0%, 3,5% and 20,0% respectively, whereas Paphos experienced a decrease of 9,2%.
The areas with highest demand are the properties that offer their owners a luxury lifestyle or other valuable feature such as sea views or location close to the beach and are usually located in areas such as Limassol, Paphos, and Ayia Napa. Eventhough seafront properties target a niche market, are sold off plan and resale properties of this kind are very hard to find. The price per m2 for seafront properties and generally luxury properties varies between EUR 8,000 – EUR 12,000 depending on the location and building specifications. A good figure to maintain is around EUR 10,000 as you can be comfortable knowing there is room for appreciation. Most foreign buyers purchase properties in the above mentioned classifications, as opposed to purchasing a property in the capital city.
These usually have a golf course or community at their core, offering properties that cater to all types of owners and include locals, new residents, second home owners and vacationers. Another project that is expected to have a high demand is the new Casino in Limassol, planned to be completed by the end of 2019 or beginning of 2020. The casino will also feature a hotel with 500 luxury rooms, and the casino section will offer between 100 and 200 table games and also between 1000 and 2000 slot machines. The casino resort will also boast restaurants, theme parks, conference centres and waterparks.
Residental and Commercial properties with a good rental income
As passport property buyers can sell their properties after a period of 3 years they prefer to buy investment properties that can offer them a good rental income. Such properties can be fully tenanted residential and commercial buildings with a steady income stream. They can vary from whole buildings to apartments, houses or commercial offices or whole buildings.