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House prices weathering COVID storm

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Due to the pandemic, there has been a small rise in house prices and rentals while other real estate values have fallen, according to a new property index.

Following the same trend as 2020, Q1 2021 was greatly affected by the coronavirus pandemic, recording a drop in prices across all property categories.

According to the first WiRE Index on rentals and property prices, rents also recorded a drop in most categories.

WiRE Index –Price Index

Pancyprian Q1 2020 Q1 2021 Annual percentage change
Apartments 74.37 74.02 -0.5%
Houses 84.74 85.99 1.5%
Retail 55.46 52.54 -5.3%
Warehouses 68.74 65.62 -4.5%
Office spaces 78.82 78.01 -1%
Holiday apartments 128.31 126.81 -1.2%
Holiday Houses 122.72 118.78 -3.2%

Source: WiRE Price Index, WiRE FS

Apartment prices fell by 0.5% in Q1 2021, compared to Q1 2020, house prices went up 1.5%, commercial properties (retail) -5.3%, warehouses by -4.5%, offices space by -1%, holiday apartments -1.2% and holiday houses -3.2%.

Pavlos Loizou, Managing Director of WiRE FS, said the big drop observed in warehouse prices is likely to be temporary since a recent increase in demand from companies engaged in logistics and firms expanding their online sales.

“We also expect the prices for holiday properties to recover soon; as the pandemic comes under control, demand for these properties will progressively increase from foreign buyers who find it difficult to visit the island now.”

It could be more difficult for the prices of commercial properties (retail) to return to positive levels.

The market needs more time to recover as consumers are going through a period of redefining their purchasing priorities, lifestyle, and the way they shop, Loizou adds.

WiRE Index – Rent Index

Pancyprian Q1 2020 Q1 2021 Annual percentage change  
Apartments 102.10 101.49 -0.6%
Houses 108.51 111.34 2.6%
Retail 53.18 49.79 -6.4%
Warehouses 61.08 61.54 0.7 %
Office spaces 81.91 79.26 -3.2%
Holiday Apartments 141.89 142.08 0.1%
Holiday Houses 141.90 134.24 -5.4%

Source: WiRE Rental Index, WiRE FS

For rentals, on an annual basis, prices dropped for apartments (-0.6%), commercial shops (-6.4%), offices (-3.2%) and holiday houses (-5.4%).

In contrast, there was a slight increase in the rental prices for houses (2.6%), warehouses (0.7%) and holiday apartments (0.1%).

“The findings are expected due to the conditions of financial instability.

“The slight increase in house rentals is probably caused by the fact that tenants are more willing to rent houses with outdoor space rather than apartments after a year of restrictions.

“It is difficult to foresee the full effects of the pandemic since only a relatively short period has passed,” Loizou said.

The WiRE Index will be published quarterly.

WiRE FS combines real estate expertise with the use of technology.

Created retrospectively from Q4 2009, the WiRE Index records the quarterly change in prices and rents for all types of properties by district: apartments, houses, retail, offices, holiday apartments and holiday houses.

It records the prices and rents for 54 areas and sub-areas and presents the collective data for each district and type of property.

For more information and metrics, as well as the methodology used by WiRE FS to produce the WiRE Index, visit https://www.wire-fs.com/wire-index/