Real estate sales slow due to rates, inflation

The value of transactions in the real estate sector reached €1.52 bln in the second quarter of 2023, with the market bearing the impact of higher interest rates, inflation and increased construction cost.

According to data compiled by the Council for Registration of Real Estate Agents, transactions in real estate were a higher €1.7 bln in the two previous quarters.

Marinos Kineyirou, the Council’s President, said the property market has shown resilience, but “challenges are increasing and should not be underestimated by anyone.”

“The real estate sector has a large contribution to the economy, and the government should strengthen the sector to maintain its momentum,” he added.

According to the data, a total of 5,974 transactions were made valued at €1.52 bln, which was lower compared to the first quarter in terms of value and transactions.

Compared with Q2 2022, the number of transactions was broadly the same, but the value rose significantly, driven by the increased prices.

The value of real estate sold in Q2 last year was €1.2 bln.

Nicosia and Famagusta were the only districts to record an increase in property values sold during Q2 compared to the previous quarter.

In Nicosia, the value of properties sold (€299.8 mln) rose despite the decrease in the volume of sales transactions (1549).

On the contrary, in Famagusta, the increase in value (€59.7 mln) was accompanied by increased sales transactions (303).

A significant decrease was recorded in Limassol; the value of properties sold decreased by €200 mln compared to the first quarter, reflecting the significant dip in sales.

Paphos also lost ground regarding value and sales volume compared to the previous quarter.

In Larnaca, the volume of transactions was higher in Q2 than in Q1, but the value of the properties was slightly lower.