Real estate sales in Cyprus are growing rapidly in2022

The transaction volumes in the real estate and land development sector in Cyprus last year exceeded the2019 figures. According to the latest edition of PwC Cyprus, the total value of transactions in2022 amounted to5.2 billion euros, which corresponds to a27% annual growth.

Apartments were undoubtedly the driving force of the market last year, with a total transaction amount of 2.1 billion euros, representing a 42% increase compared to 2021. The rise in demand seems to be partially linked to the arrival of foreign companies that decided to establish their headquarters in Cyprus and relocate their operations and employees to the country, focusing on coastal areas. The second part of the demand was driven by persistent domestic demand. The number of apartment transactions reached 9,000 in 2022, compared to 7,000 in 2021, which corresponds to a 29% increase.

The cancellation of the Cypriot investment citizenship program (effective from November 1, 2020) has reduced activity levels in the luxury real estate sector (1.5 million euros). In 2022, this sector partially recovered, with a total of 220 luxury real estate transactions, reflecting a 36% annual growth and indicating its activity.

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Residential properties priced between 100,000 and 300,000 euros seem to be the most resilient segment of the real estate market. The number of transactions for residential properties in the 100,000 to 300,000 euro range reached 7,600 in 2022, corresponding to a 19% annual growth. In 2019, there was a recorded increase of 41% compared to pre-pandemic levels. This is mainly attributed to the rising demand for primary housing and increased investment activity in rental properties (especially apartments), as well as heightened interest from foreign buyers relocating to Cyprus.

Despite the growing demand for real estate, data on transactions shows that the pace of building permit issuance slowed down in the first 10 months of 2022 (the latest available data), resulting in a 5% year-on-year decline. This is largely due to the ongoing increase in the cost of construction materials in 2021 and 2022.