The Cyprus property market has changed a lot in recent years, attracting the interest of both local and foreign investors.
In 2022, the property market witnessed a surge that stands as a testament to the resilience and potential of the island’s real estate ecosystem.
A Year of Impressive Growth
Earlier this year, the Department of Lands & Surveys released noteworthy data, revealing a 30% increase in property sales contracts in 2022, reaching a total of 13,409 contracts. Such an uptick has not been seen since 2008, when properties saw 14,667 contracts being deposited. Moreover, December trends alone showcased 1,335 property sales, marking a 4% increment from December 2021.
Regional Divergences: Larnaka Leads the Charge
Unsurprisingly, different regions displayed varying growth rates. Larnaka emerged as the frontrunner, boasting a 16% year-on-year increase in December 2022, closely followed by Limassol and Paphos, with increments of 10% and 7% respectively. Conversely, Nicosia’s sales dwindled by 13% in December, and Famagusta saw a 1% drop.
Pondering the Slowdown
The slight deceleration noticed in December 2022 raises eyebrows. However, speculations suggest that global geopolitics, augmented building material costs, rising interest rates, and mounting inflationary pressures might be potential culprits, influencing the island’s real estate trends.
Forecasting the Cyprus Property Market: 2023 and Beyond
The Cyprus property market trajectory observed in 2022, hints at a future with multifaceted implications. The island showed remarkable resilience, especially in the foreign investment domain, as it tackled geopolitical impacts, escalating commodity prices, and inflationary strains. Therefore, heading into 2023 and the subsequent years, we anticipate a few prominent trends.
First, with increasing global mobility and the lingering allure of the Mediterranean, foreign investment, especially from non-EU nationals, is poised to strengthen further. This surge will likely counterbalance the challenges faced by domestic buyers, who might find themselves increasingly priced out of the market due to economic pressures.
Meanwhile, regions such as Larnaka, with their recent robust growth, may become hotspot destinations for both local and international investors. It is, however, essential to monitor the geopolitical climate and its potential impacts, as it could introduce uncertainties or shifts in buyer demographics and preferences.
In essence, while the Cyprus property market will undoubtedly face challenges, its inherent appeal and the rising international interest herald a period of sustained growth and dynamic evolution.
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Dissecting the Buyer’s Pool
- Domestic (Cypriot) Buyers: Local Cypriot buyers, who were the mainstay of the market, accounting for 52% of sales in December 2021, felt a pinch with a 9% dip in December 2022. This culminated in a year-end tally showing a decent 12% growth, translating to 7,481 sales.
- Foreign Buyers: Foreign buyers, on the other hand, were the buzz-makers. They grew from 48% in December 2021 to a surprising 24% spike in December 2022, clocking in a total of 5,928 sales for the year – a robust 61% leap from 2021.
- EU Nationals: EU nationals experienced a slight setback of 11% in December 2022 but wrapped up the year on a high note with a total of 2,545 property acquisitions, marking a 39% annual increase.
- Non-EU Nationals: Sales from non-EU nationals in December 2022 marked a significant 59% growth from the previous December. The total sales to non-EU nationals in 2022 surged by 82% from 2021, reaching 3,398.
While domestic demand remains a strong pillar, the increasing appeal for foreign investors, especially non-EU nationals, cannot be understated. With ongoing and dynamic shifts, Cyprus continues to intrigue and attract those looking for lucrative property investment opportunities on the shimmering shores of the Mediterranean.
As we take a closer look, the Cyprus property market narrative of 2022 is one of resilience, recovery, and resurgence. Still, navigating the intricacies of Cyprus’s dynamic property and business landscape requires expertise and local knowledge.
At Polycarpos Philippou & Associates, our firm provides advice to both experienced and novice investors, catering to the distinct requirements of each person with an emphasis on clear communication, openness, and reliability.
Ready to unlock the potential of Cyprus’s thriving property market? Dive in and discover unparalleled investment opportunities with us today!