According to PwC’s in-depth analysis, the total value of Cyprus real estate transactions reached a record-high of €5.2 bln in 2022, recording an annual increase of 27%.
In volume terms, properties transacted last year reached 22,500, up 12% from the previous year, surpassing pre-pandemic 2019 levels by 31%.
During the year, Limassol, Larnaca and Paphos experienced double-digit annual increases in transaction volumes (18%, 23% and 31%, respectively).
On the other hand, the districts of Nicosia and Famagusta experienced marginal drops of 6% and 1%, respectively.
Undoubtedly, the driving force of the market relates to apartments, with the value of transactions reaching €2.1 bln during 2022, a 42% increase compared to 2021.
“Demand appears to have been fuelled by a growing appetite from companies of foreign interests to relocate their operations and staff to the island, mainly in the coastal areas, and was further supported by a resilient domestic segment,” said PWC’s Cyprus report.
PwC data indicate that 9,000 apartments were transacted during the year, recording a 29% annual increase.
High-end properties
The termination of the Citizenship for Investment Programme (effective 1 November 2020) led to an observed shrinkage of activity levels in the high-end residential property segment (≥ €1.5mln).
During 2022, a partial recovery of this segment was observed, with 220 transactions of high-end residential properties recorded, demonstrating a 36% annual increase and signalling that this sector remains active.
Residential properties between €100k – €300k reached 7,600 in volume, representing a 19% annual growth and a 41% spike from pre-pandemic 2019. “This is mainly a result of strong demand for primary residences and increasing investment activity in private-rented housing (particularly apartments), combined with the growing levels of foreign demand in the context of relocations to Cyprus,” said PwC.
Cost of materials
Despite the growing levels of demand for real estate, as evident by the transaction data, building permits decelerated during the first 10 months of 2022, recording a 5% annual drop.
This is largely attributed to the continuous hike in the cost of materials, sustained throughout 2021 and 2022, with prices growing by 30% over two years, “disrupting market balances and particularly the private/single housing segment”.
PwC Partner Cyprus, Constantinos Constantinou, said: “In an environment which at the wider geopolitical level is dealing with several challenges and crises, the Cyprus real estate sector proved to be particularly resilient, exceeding expectations in transaction activity levels observed during the year, fuelled by the ongoing demographic shifts observed on the island.”
To download the Cyprus Real Estate Market Report of PwC, click here.
