The Cyprus real estate market has demonstrated significant resilience in early 2025, with strong demand from foreign investors and stable prices creating a robust environment. However, this stability is creating affordability challenges for local buyers, according to a statement released Monday by Marinos Kineyirou, president of the Cyprus Real Estate Agents Registration Council.
Market Drivers and Price Stability
The market’s current strength is being fueled by two primary sources of demand. Foreign buyers, particularly from non-EU countries such as Israel and Lebanon, continue to show strong investment appetite, seemingly undeterred by regional geopolitical tensions. Additionally, local investors are turning to property as a more attractive option for their capital, driven by minimal returns on bank deposits.
This high demand is balanced by a healthy supply of available properties, which Kineyirou noted is a key factor in maintaining price stability.
Data from Eurostat supports this assessment, showing that Cyprus is on a more restrained path than its European counterparts. In the first quarter of 2025, the annual property price increase in Cyprus was 2 percent, considerably lower than the European Union average of 5.7 percent.
The Affordability Challenge for Locals
Despite the market’s overall health, the combination of high property prices and an increased cost of living is making it increasingly difficult for many Cypriots to purchase a home. This challenge persists even as lending rates have begun to gradually decrease. Kineyirou acknowledged that strong foreign demand has undeniably contributed to the upward pressure on prices.
A Look at Regional Dynamics
The real estate market shows distinct trends across the island’s major districts:
- לימסול continues to lead the market for expensive and luxury properties.
- פאפוס has seen a strong surge in demand over the past two years from both Cypriot and foreign buyers.
- לרנקה is experiencing increased interest in smaller, more affordable units, such as one and two-bedroom apartments. Its competitive pricing has made it an attractive option for buyers from other districts, including Nicosia and Limassol.
Kineyirou concluded that while the market is in a phase of “intense activity and stability,” it must respond to the pressing issue of housing affordability for local residents. He also addressed what he called a “myth,” stating that property prices are set by owners and shaped by supply and demand, not artificially inflated by licensed real estate agents.
Source: Cyprus Mail