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The housing market in Cyprus is booming. Latest figures from the Department of Lands and Surveys show that contracts deposited at Land Registry offices in April were up by more than 60% on the same period last year.
It’s the highest monthly figure since September 2008 and suggests that slippage recorded in March was a blip, not a trend.
Property sales rose in all districts and expats have been active in the market – 41% of the contracts were deposited by non-Cypriots.
A rush to acquire Cyprus passports before tougher rules came into force on May 15 may have accounted for some of the April increase.
But a report from PricewaterhouseCoopers (PWC) shows that sales have been strong throughout the year.
There was a six per cent increase in sale contracts across Cyprus, with the majority of transactions recorded in Limassol (37%), followed by Paphos with 24% of the total.
Prices in Limassol outperformed all other districts in terms of annual growth and luxury properties have been selling well.
What the PWC report calls “high-end residential property” represented 19% of the total transactions, with Famagusta, Larnaca and Nicosia also proving popular.
Expats, again, made an important contribution to the buoyant market. According to the PWC annual real estate report, some 4,367 properties were acquired by foreigners.
The highest concentration of sales to expats was in Paphos (40%), followed by Limassol (30%).
Apartments are the preferred residential property, comprising 78% of the total high-end transactions in Limassol with the remaining 22% being villas.
Buyers from EU countries made up an important sector but were not as dominant as might have been expected. Almost 67% of properties acquired by expats went to non-EU buyers.
The ability to acquire Cypriot, and therefore EU, citizenship along with your property is one of the big attractions for non-EU buyers and prompted the Yahoo! Finance website, in a recent survey, to rate Cyprus the third best country in the world for Americans to call home from home.
Non-EU interest has greatly widened the market. Georgina Reilly, head of international sales at Select Resorts Properties, told the Times of London: "You used to be able to buy less expensive properties, and the British had quite a presence (but) international interest has increased substantially from Chinese, Russian, Asian and Middle Eastern buyers.
This has led to an influx of luxury apartment blocks, mostly located in Limassol, along with high-spec villas with magnificent sea views changing the face of the Cypriot property market."
Expats who buy in Cyprus can expect the value of their property to keep increasing for the foreseeable future.
Zyprus, the property portal, predicts that the value of Limassol apartments will increase this year by 6.6% and Paphos apartments by 7.49%. The value of houses in Larnaca and Famagusta will rise by close to five per cent.
Nevertheless, expats should think hard before buying individual properties as an investment.
Renting out a property is tricky, and the rules are complex. Taxes and charges will eat into your profit when you come to sell.
By all means, buy yourself a nice house here, confident that it will increase in value. But property for profit is an investment best left to the experts.
Including property in your investment portfolio is a different matter – but that, too, is best done with professional advice.
If you are an expat who plans to settle in Cyprus, to retire or to work, my company, the Woodbrook Group, will be happy to help you.
We are an international firm of financial advisers with its headquarters in Cyprus.
We are not owned by any financial institution or life insurance company and can offer you unbiased and impartial advice to help you understand your options and how to address your income needs.
I always advise expats to look for a full lifestyle package, one that will secure their finances and match the income they have with the lifestyle they want. If that lifestyle includes a dream home, so much the better.
