Real estate price and rental rate index Q1 2023.

According to the 54th quarterly report of the RICS Cyprus Property Index in conjunction with KPMG in Cyprus, which tracks property prices and rentals in all areas of Cyprus and the main property types, an increase in the property price and rental index was recorded.

Year-on-year comparison

Year-on-year comparisons show an increase in value across all asset classes, with the largest increase seen in the apartment category, followed by offices and homes. The lowest increase is seen in the retail sector.

Here are some figures: apartment prices rose by 10.97%, house prices by 8.48%, retail space by 0.95%, warehouses by 4.82% and offices by 9.63%.

Year-on-year comparison in the rental sector

On a year-over-year comparison, both rental sectors also showed growth, with vacation rentals, closely followed by residential properties (apartments, houses), showing the largest gains. Retail and warehousing were at the lower end of the growth scale, with retail showing the lowest growth.

Here are some numbers: apartment rentals are up 29.07%, house rentals are up 28.32%, retail rentals are up 4.01%, warehouse rentals are up 4.52%, office rentals are up 14.13%, vacation rentals are up 31.35%, and vacation home rentals are up 18.02%.

Rental yield

As for rental yields, in the first quarter of 2023, they were: apartments 5.37%, homes 2.86%, retail 5.77%, warehouses 4.30%, offices 5.35%, vacation apartments 5.71%, vacation homes 2.71%.

According to Christoforos Anaiotos, head of KPMG's real estate group in Cyprus: "In the first quarter of 2023, the trend of increasing property values in most asset classes continued, especially in Larnaca.The most successful sector is houses, where growth is recorded in all districts. However, the biggest increase was recorded in Larnaca in the offices and apartments sector. Retail showed a slight increase in Limassol, but also the biggest drop for the quarter in Larnaca.

According to Simon Rubinsohn, chief economist at RICS: "The steady performance of the economy is reflected not only in this data set, but also in the overall positive view of the nation's real estate market.This suggests that demand has increased in most neighborhoods in recent months and that rental expectations remain generally optimistic, which is contributing to investor interest."

The RICS Cyprus Property Price Index, in conjunction with KPMG, tracks hypothetical or notional buildings with certain characteristics. Details of these hypothetical properties are provided in a report by the University of Reading. The price per square meter provided is based on the total external area of the property (as defined in the RICS Measurement Practice 8th Edition), which includes living space and covered porches but excludes common areas. Price level assessments are carried out by RICS accredited specialist real estate experts who are active in the relevant markets. Details can be found in the RICS Cyprus Property Price Index in conjunction with KPMG for Q1 2023.