Increase in Property Prices in Cyprus
The first increase in property prices since 2009 has been reported in the last quarter of 2016, in a further sign of the stability and expansion of the Cyprus economy.
The Property Price Index has noted increases in property prices across all towns and asset categories.
According to the Property Price Index, an increase in residential property prices for houses and flats across Cyprus in the last quarter of 2016 has been recorded by 0.6% and 0.9% respectively.
The biggest increase documented has been in Limassol with an increase of 1.4% in prices for flats followed by Paphos, with an increase of 1.77% for houses.
According to the 28th publication of the RICS Cyprus Property Price Index (a quarterly price and rental index which tracks property and rental prices across Cyprus), compared to the third quarter of 2015, year on year prices of flats increased by 0.6%, 0.9% for houses and 0.9% for offices.
Tellingly, as the Cyprus economy has also shown significant signs of increase and stability in 2016, there has also been an increase of 0.8% in retail prices.
The volume of property transactions during the quarter was also higher on a year on year basis.
According to Mr Vakis Iacovou, Fellow Chartered Certified Accountant (FCCA), as the Cyprus economy is expected to grow further in 2017 and in turn, property prices are also expected to increase, now is the ideal time for investors to purchase assets in Cyprus.
Positive increases were also noted in rental values and gross yields.
In comparison to the third quarter of 2015, rents for flats increased by a staggering 5.3%, 6.7% for houses, 3.9% for retail, 3.5% for offices and 2.5% for warehouses.
At the end of the third quarter of 2016, average gross yields for apartments were at 4%, 2% for houses, 5.4% for retail, 4.4% for warehouses and 4.5% for offices.
According to the Central Bank of Cyprus, the positive growth of the property market in Cyprus is as a direct result of the expansion and stability of the economy overall. In the last quarter of 2016, the economy’s performance outperformed expectations.
It is predicted that as the economy stabilises and grows further in 2017, so too will the confidence in the property market return. Thus, it is anticipated that as demand increases in 2017, property prices across the island will grow from strength to strength.