Will the crisis in the Middle East affect the real estate market?

The Cypriot real estate sector is unsure how recent events in the Middle East will affect the immediate future of real estate. Attention is naturally focused on the ongoing military operations and the humanitarian aspect of the conflict between Israel and Hamas, but real estate stakeholders foreshadow how events may lead to future investments by Israelis in Cyprus. These investments could include land acquisition, property development, or even business relocation, and could possibly lead to new increases in real estate purchase and rental prices.

However, it is difficult to draw concrete conclusions now, real estate agents say. Panos Danos, CEO of DANOS International Property Consultants & Valuers, suggested in comments to Phileleftheros newspaper that the impact on the domestic real estate market will depend on the duration of the crisis. "A quick resolution could lead to a milder impact, allowing for a transitional period combined with the typical time lag in the market. "If the situation stabilizes, the consequences may be less severe," Danos said. He noted that the Cypriot market is on an upward trajectory, thanks in part to foreign direct investment in various real estate sectors. Danos said a possible decline in the international real estate market could affect Cyprus, which was an attractive destination for investors before the Israeli crisis.

Ask Wire's Pavlos Loizou said there has not been a noticeable surge in Israeli interest in Cyprus since the crisis. "However, the situation is expected to change in the coming weeks for both renting (1 to 12 months) and buying real estate (6 months or more) in Cyprus," Loizou said. He added that historically cities such as Limassol, Larnaca and to a lesser extent Paphos have been the most attractive to Israeli buyers. "A possible increase in demand from Israelis could lead to higher prices for renting and buying real estate. "Short-term accommodation platforms such as Airbnb may also experience increased interest." He added that because of the timing of the conflict, at the end of the tourist season, many properties that normally have low occupancy rates are expected to be rented out. "In this dynamic and evolving situation, it is still too early to draw final conclusions," Loizou said.