Rising real estate prices are pushing foreign investors north.

The recent developments in the Cypriot property market highlight a significant shift in buyer interest towards the occupied territories, with pricing rather than the ongoing conflict with Israel being the main factor, the Council of Cyprus Estate Agents said. Council President Marinos Kineiro explained that the interest of foreign buyers has had a significant impact on the Cypriot real estate market over the past few years. In this context, he noted that following the Covid-19 pandemic, interest from foreign buyers has played a significant role in revitalizing the market after a period of deep crisis.

"The interest of foreign buyers has supported the Cypriot real estate market in recent years," said Kineiro. "It is no exaggeration to say that in the aftermath of the Covid-19 pandemic, the interest of foreign buyers has significantly boosted the market and has contributed significantly to its recovery from the severe shock it had undergone," he added.

Analyzing real estate sales data on a quarterly basis

represented by the Council of Estate Agents, Kinheiro pointed to a steady increase in property sales in Cyprus over the nine-month period of 2023. However, he emphasized a significant shift indicating signs of stagnation in all cities and areas controlled by the Republic of Cyprus.

Despite widespread speculation linking the market stagnation to the conflict in neighboring Israel, Kinheiro argued that while the war has affected the interest of Israeli and Lebanese buyers, it is not the main cause. He emphasized that excessively high property prices have equally cooled the interest of both domestic and foreign buyers. "Many experts and non-experts claim that the stagnation in the market is due to the war that erupted in neighboring Israel, as it slowed down the interest of Israelis even Lebanese buyers," he said.

In addition

Kineiru noted that there is a noticeable trend where foreign buyers' interest has shifted beyond the Green Line to the occupied territories. He believes that Israeli and Lebanese buyers are now investing in real estate there despite the ongoing conflict. This shift has become visible in the Turkish Cypriot press and social media, where targeted advertising campaigns aimed at the Israeli and Lebanese markets have been noticed. "In addition to the Russians who, following the outbreak of war in Ukraine and subsequent sanctions, have spilled into occupied Cyprus, both Israelis and Lebanese are choosing to buy homes in the Turkish-administered zones of our homeland," he said.

In response to this shift in the market, Kinheiro said there are two perspectives on this phenomenon: willful ignorance and pragmatism. "We who live and earn in the real estate market in the free zones of the Republic of Cyprus, in our opinion, have two choices," he said, noting that the first option is to "continue to gloss over the problem and look for excuses to reduce demand." "The second option is to recognize that we have crossed the line with prices to the point of discouraging foreign buyers," he added.

Closing his observations, Kinheiro emphasized the government's role in countering the trend, urging property owners to confront the problem rather than shying away from reality to avoid possible repercussions in the market. "The country has a government and mechanisms that can do everything possible to stop this flow of foreign property buyers into the occupied territories," Chineiro emphasized. "Property owners must quickly realize that if they hide this problem, refuse to confront the truth directly, and refuse to rationalize real estate sales prices, I fear we will once again be mourning disaster after disaster," he concluded.