The pace of residential property price increases in Cyprus is continuing to ease, according to the Central Bank of Cyprus (CBC). In its latest Quarterly Residential Property Price Index report for Q4 2024, the CBC points to two major headwinds: persistently high construction costs and elevated borrowing rates.
Overall Trend: Growth Slows Down
While prices are still rising, the rate of increase has cooled compared to previous quarters, especially for apartments. The Apartment Price Index saw a sharper slowdown than the House Price Index, indicating that demand for flats may be softening more quickly.
This softening trend is mirrored in other indicators too — like the decrease in sales documents filed and the increase in available properties for both rent and sale, suggesting a market that’s moving toward stabilization after a period of intense growth.
Why the Slowdown?
The CBC highlights two ongoing challenges:
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High construction costs continue to put pressure on developers
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Higher interest rates are making home loans less attractive, which affects buying power across the board
These factors have noticeably reduced activity and growth across much of the real estate sector.
Regional Breakdown: Paphos Stands Out
The only district to buck the trend in Q4 2024 was Paphos, where prices surged by 13.4% over the year. Here’s a look at how other areas performed:
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ניקוסיה: +0.7% (slowed)
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לימסול: +4.4% (slowed)
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לרנקה: +6.5% (slowed)
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פמגוסטה: +9.2% (slowed)
On an annual basis for houses specifically:
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פאפוס again led the way with a 14.7% increase
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לימסול: +5.1%
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פמגוסטה: +7.8%
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לרנקה held steady at +6.1%
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ניקוסיה actually saw a decline of -0.4%
For apartments, every district saw a reduced pace of growth:
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ניקוסיה: +2.6%
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לימסול: +5.5%
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לרנקה: +8.7%
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פאפוס: +12.1%
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פמגוסטה: +14.2%
Meanwhile, sales documents — a good proxy for buying activity — increased in all districts except Nicosia and Famagusta, where they declined.
About the Index
The CBC’s property price indices are compiled by the Real Estate Unit (REU) within the Economic Analysis and Research Department, in collaboration with major Cypriot banks and KEDIPES. These indices rely on valuation data dating back to 2006, collected by banks during mortgage-related transactions, making them a reliable reflection of Cyprus’s real estate market.
The data covers residential properties across all regions under the Republic of Cyprus’s control: Nicosia, Limassol, Larnaca, Paphos, and Famagusta.
Source: Stockwatch.com.cy