A CHANGING TREND
Historically, Cyprus has boasted one of the highest homeownership rates globally, remaining a cultural cornerstone of Cypriot life that is deeply rooted in family traditions and societal values. This however, seems to be changing and recent studies have shown a changing trend indicating that home homeownership on the island is now dropping below the European Union average. Whilst there are still a few people who can still afford to buy their own homes, the majority it seems cannot and some analysts have suggested that if this trend continues, then there will be a need for new policies addressing housing affordability to support sustainable homeownership that will ensure that this tradition continues for future generations.
AFFORDABILITY CHALLENGES
The numerous challenges faced by purchasers, or people that want to build a new home are evident on the island and affordability challenges amidst economic and market changes have proved too volatile. Falling household incomes and difficult access to financing have made homeownership less attainable for many. Additionally, rising property prices and high mortgage rates have further strained affordability for all Cypriots. The island’s real estate market has also seen increased foreign investment, particularly in urban centres and coastal areas, and this has further driven up property values all over the island making it more challenging for residents to purchase homes.
A DOWNWARD TREND
At the turn of the century, approximately 80% of Cypriots owned their own homes. This is in contrast to recent figures indicating that the figure now stands at 70%. The decline in homeownership has
prompted some analysts, to attribute the downturn directly to the recent banking turmoil, but there are other factors to consider also! The housing market sector has experienced significant shifts over the past two decades, although the biggest impact has been the economic challenges faced by all after the 2013 financial meltdown that resulted in the financial crisis that saw several banks disappear along with a great deal of money.
RENTAL INCREASES
As a result, the once nation of proud homeowners are now choosing to rent homes instead of building or purchasing new ones and recent evidence has indicated that high demand in the rental sector is causing sharp rent rises all over the island. The Cyprus homebuyers that remain now favour cheaper options, such as apartments or homes in rural areas.Â
PROPERTY SALES IN CYPRUS SEE MODERATE GROWTH IN 2024
Last year’s Cyprus property market saw moderate growth, despite regional differences in filings for sales. According to land registry data, Nicosia and Larnaca led the way, helping to drive a 1.5% overall increase in sales.
The District of Nicosia experienced a significant surge of up to 14%, with the District of Larnaca following with a 5% rise. The three other districts however, saw a drop in sales, with the District of Paphos recording an 8% decline, followed by a 5% decline for the District of Famagusta and a 1% decline for the District of Limassol.
