Despite the property market generating €6 billion in sales in 2022, real estate agents expect a challenging 2023.
Releasing its quarterly “Real Estate Market Bulletin”, the Cyprus Real Estate Registration Council said that the value of real estate sold last year was €5.85 bln.
The Council appeared satisfied, noting that “against the challenges, the real estate sector showed resilience and dynamism, which is reflected in the clearest way in the comparative sales”.
According to data from the Land Registry, 22,129 transactions were recorded in 2022 with a total value of €5.85 bln.
The fourth quarter of 2022 was the best of the year, as properties worth €1.7 bln were sold in 5,883 transactions.
In Q3 2022, the registry recorded transactions worth €1.65 bln, compared to €1.2 bln in Q2 and €1.3 bln in Q1.
The President of the Registration Council of Real Estate Agents, Marinos Kineyirou, said: “The real estate sector in an extremely difficult period managed to grow and develop.”
“However, a series of challenges related to inflation, rising interest rates, the cost of construction materials and the new realities concerning the reduced 5% rate of VAT for the main residence are expected to affect demand”.
Limassol recorded the largest sales volume with 6,945 real estate transactions worth €2.86 bln.
Nicosia followed with 6,237 transactions with a total value of €1.2 bln.
The real estate sector in Paphos grew significantly, both in the number of transactions (3,593) and in their total value, which reached €890.4 mln.
In Larnaca, 4,160 transactions had a value of €666.2 mln, while in Famagusta, 1,194 transactions were worth €238.4 mln.
In earlier comments to the Financial Mirror, Panos Danos FRICS, CEO of DANOS International Property Consultants & Valuers, said he expected 2023 to be a year of stability, as the inventory of real estate assets is expected to remain relatively high.
“This is not bad news, as the more the inventory, the more options for buyers and the more negotiable prices are.
“However, mortgage rates will remain high, and banks will still be difficult to agree on loans.
“It may mean that sellers might see fewer profits, but they will most likely profit, nevertheless.
“It is unlikely that 2023 will be a major turning point for the real estate market in Cyprus.
“Buyer demand is not expected to surge, and sellers are not going to change prices drastically”.
Danos said the real estate market and prices will leverage demand and supply, with buyers still viewing the property market as a solid investment for their money.
“But, still, buyers and sellers will take some time to digest the new norms, probably the first quarter of 2023, and to process the new adjusted prices.
“A risky but reasonable long-term prediction is that 2024 is unlikely to see a significant improvement in prices or interest rates.”