Property market in Cyprus showing shoots of recovery
There are signs that the property market in Cyprus is recovering from the downturn which saw sales plunge and prices fall considerably after the island has to seek financial back up from the European Union.
The latest figures from the Land Registry shows that there has been an increase in domestic and foreign buyers but it must be remembered that the growth is coming from a very low base.
Overall sales to foreign buyers have increased by 20% year on year in the first five months of 2014 with the biggest growth in Nicosia, Famagusta and Limassol.
Nicosia has seen the number of sales in this period rise from 246 to 371, a rise of 51%, Famagusta from 89 to 136, a rise of 53% and Limassol from 366 to 529, a rise of 45%.
In other locations popular with overseas buyers, Larnaca has seen a small rise in transactions, up 10% from 264 to 290 but Paphos has seen sales fall, down from 547 to 484, a decrease of 12%.
The Land Registry data shows that overall 551 bills of sales were submitted in May this year, an increase of 157% compared to May last year. Over the same timescale the number from foreign buyers has increased from 71 to 153, a rise of 115.5%.
‘There is a significant increase in the purchase of real estate by foreigners on a national basis. This suggests that Cyprus with its attractive prices offered in combination of quality products and service, good weather, geographical and geopolitical position, the legal framework, the low corporate tax, as well as the conditions in our neighbouring countries, continues to attract the interest of foreign and local investors,’ said Alecos Vilanos, manager of Vilanos Real Estate.
He believes that Limassol is set to lead the way for foreign buyers with its major marina project having been recently opened to the public on June 19. It is expected that recent offshore discoveries and the development of the island’s energy sector is expected to attract a significant number of local and foreign property investors.
‘The real estate sector still retains the leading role in terms of the recovery of Cyprus’s economy. Incentives to real estate investors in terms of permanent residence permits for non-European nationals are expected to increase the demand for real estate and boost the investment market for offices, homes and other facilities,’ Vilanos explained.
‘There is optimism around of a full recovery of the property sector in Cyprus, and in particular in attracting a larger number of buyers and investors. Investments in property over time lead to long term benefits and never lose their values,’ he pointed out.
‘The Land Registry figures point to a gradual recovery of the property market with an increasing interest from foreign investors and buyers. The situation in the real estate market is showing signs of stabilisation. However, in order to achieve a complete recovery and return to normalcy, the restrictions concerning financing for purchase or real estate investment have to be fully reinstated,’ he added.