Property activity declines

Property sales have declined by 29% year-on-year during the first half of the year to CYP 442 mln compared to CYP 626 mln a year ago in the same period, according to the Land Registry figures.

The CYP 184 mln decline in business in the year is due mostly to the introduction of VAT, higher government transfer fees, the ever increasing cost of construction material, the partial shift by foreigners to the north as well as the impact from the slowdown in the economy and income growth. The figures are nevertheless above the first half figures of 2003 when CYP 411 mln of property deals were concluded in the same period.

Industry experts blame most of the decline on the sharp increase in property prices, with Paphos now matching prices quoted in Spain and driving itself out of the market.