Will real estate prices in Cyprus go up in 2025?

Authored by the expert who managed and guided the team behind the Cyprus Property Pack

Everything you need to know before buying real estate is included in our Cyprus Property Pack

Cyprus property prices are definitively going up in 2025, with a 6.5% year-on-year increase recorded and strong market fundamentals supporting continued growth.

The Cyprus real estate market continues its upward trajectory in June 2025, driven by robust foreign investment, limited supply in prime locations, and improving economic conditions. With transaction volumes up 21% in January 2025 and prices rising across all districts, understanding the current market dynamics is crucial for anyone considering property investment in this Mediterranean island.

If you want to go deeper, you can check our pack of documents related to the real estate market in Cyprus, based on reliable facts and data, not opinions or rumors.

This article is for informational purposes only and should not be considered financial advice. Readers are advised to consult with a qualified professional before making any investment decisions. We do not assume any liability for actions taken based on the information provided.

Who is the author of this content?

INVESTROPA

A team specialized in real estate investing in European countries

We are a team of financial experts, legal professionals, developers, and local real estate specialists dedicated to helping people like you avoid mistakes when investing in real estate in a foreign place, particularly in Cyprus. If you'd like to learn more about us, you can check our presentation page.

Fact-checked and reviewed by our local expert

✓✓✓

Nikki Grey 🇬🇧

CEO & Director, Europe Properties

With years of experience in European real estate, Nikki Grey understands the unique appeal of Cyprus as a prime investment destination. At Europe Properties, she facilitates property acquisitions that offer both lifestyle and financial benefits, including access to the island's Golden Visa program. Her insights help investors navigate the Cypriot market, from beachfront villas to lucrative rental properties.

What is the current average price for residential properties in Cyprus?

As of June 2025, Cyprus residential property prices show significant variation by type and location, with the national average standing at €2,518 per square meter.

Apartments across Cyprus range from €250,000 to €506,500 depending on location and specifications, while houses command higher prices averaging €461,000 to €760,000. The most expensive district remains Limassol with median prices of €660,000, followed by Paphos at €613,000, while Larnaca offers the most affordable options at €300,000 median listing price.

Nicosia, the capital, sits in the middle range with median prices around €320,000 to €350,000, and Famagusta averages €465,000. These price variations reflect local supply and demand dynamics, with coastal areas and major cities commanding premium prices due to higher foreign investment interest and limited available inventory.

It's something we develop in our Cyprus property pack.

The luxury segment, particularly in Limassol, continues to see strong demand with new waterfront apartments reaching €426,000 on average, while more modest properties in suburban areas offer better value for local buyers and first-time investors.

How much have property prices increased in Cyprus during 2024 and early 2025?

Cyprus property prices have maintained steady growth throughout 2024 and into 2025, though the pace has moderated from the double-digit increases seen in previous years.

In 2024, the market recorded a 2.5% annual increase in Q1, rising to 6.5% by Q3, with apartments leading the growth at 8.8% annually compared to 6.0% for houses. This represents a significant moderation from 2023's robust 7.7% overall growth, indicating a transition toward more sustainable price appreciation.

January 2025 started strong with property sales contracts increasing by 21% year-on-year, while transaction volumes through April 2025 show an 11% increase compared to the same period in 2024. The first quarter of 2025 saw 4,137 transactions, marking a 15% surge that demonstrates continued market confidence despite moderating price growth.

Market analysts attribute this balanced growth to increased housing supply, with building permits up 10% in 2024, and a more cautious approach from investors following the rapid appreciation of recent years.

Which areas in Cyprus are experiencing the highest property price growth?

Larnaca has emerged as the surprise leader in property price growth during 2025, outpacing traditionally dominant markets like Limassol.

According to recent data, Larnaca recorded exceptional growth with apartment sales surging 66.3% in both volume and value, positioning it as the most dynamic market on the island. Property prices in Larnaca are expected to increase by 9-10% in 2025, driven by the international airport expansion that handled 8.1 million passengers in 2023, up 34% year-on-year.

Paphos follows closely with 44% growth in May 2025 and projected annual increases of 9-10%, benefiting from strong foreign buyer interest where 67% of transactions involve international purchasers. Famagusta recorded the highest annual price increase at 11.8% for houses, though from a lower base.

Meanwhile, Limassol's growth has moderated to 7-8% annually as the market matures and buyers seek more affordable alternatives. Nicosia shows the slowest growth at 5-6%, reflecting its position as primarily a domestic market with less international investment pressure.

This shift represents a significant rebalancing of the Cyprus property market, with previously overlooked areas now offering both strong growth potential and better value propositions for investors.

Are foreign buyers still driving the Cyprus property market in 2025?

Foreign buyers continue to play a crucial role in Cyprus property market dynamics, though their influence varies significantly by region.

EU citizens have shown remarkable enthusiasm for Cyprus real estate in 2025, with purchases up 29% year-to-date, while non-EU buyers increased more modestly at 7%. This surge is particularly notable given concerns about rising prices and potential regulatory changes being discussed by the government.

In Paphos, foreign buyers now outnumber domestic purchasers, accounting for 67% of all transactions, highlighting the district's appeal to international investors and holiday home seekers. Limassol also maintains strong foreign interest, particularly in the luxury segment, though exact percentages vary by development.

The Cyprus permanent residency by investment program, requiring a minimum €300,000 property purchase, continues to attract non-EU nationals, contributing to sustained demand in the mid-to-upper market segments across coastal areas.

What are the current rental yields for Cyprus properties?

Cyprus offers competitive rental yields that continue to attract investors seeking passive income opportunities in the European market.

As of Q4 2024, apartment rental yields average 5.42% nationally, significantly outperforming houses at 3.03%, while commercial offices achieve the highest returns at 5.64%. Location plays a crucial role in yield potential, with Limassol leading at 5.29% for residential properties, followed by Nicosia at 4.78% and Paphos at 4.25%.

The rental market has experienced substantial growth, with prices jumping 18.57% in 2023, and Limassol seeing extraordinary increases of 25.3% for apartments and 24% for houses. This surge reflects strong demand from the expanding tech sector, with government tax incentives attracting thousands of international workers who prefer high-end rental properties.

It's something we develop in our Cyprus property pack.

Current average asking rents stand at €1,803 monthly for apartments and €3,249 for houses nationally, though Limassol commands significantly higher rates due to its concentration of luxury properties and international business presence.

How is the construction boom affecting property prices and supply?

The Cyprus construction sector is experiencing significant growth that's reshaping the property market dynamics and price trajectories.

Building permits increased by 10% in 2024, with 8,801 residential units approved compared to 7,999 in 2023, indicating a robust pipeline of future supply. This surge is particularly notable in Larnaca and Limassol, where streamlined licensing procedures introduced in June 2024 have accelerated project approvals.

New residential construction projects are predicted to grow by 10% annually through 2025, driven by strong rental demand and the shift toward sustainable, energy-efficient homes. However, construction costs have risen 10-15% due to material price increases and labor shortages, with ready-mix concrete prices up 5% from January 2025 following industry strikes.

Despite increased supply, demand continues to outpace construction in prime locations, particularly for modern, well-connected properties with smart home features and energy-saving designs. This supply-demand imbalance suggests prices will continue rising, though at a more moderate pace than previous years.

The focus on green building standards and Nearly Zero Energy Buildings (NZEB) requirements is adding to development costs but creating a new premium segment that commands higher prices and attracts environmentally conscious buyers.

What impact are interest rates having on the Cyprus property market?

The European Central Bank's aggressive rate-cutting cycle has significantly improved financing conditions for Cyprus property buyers.

With the ECB base rate dropping from 4.50% to 2.15% between June 2024 and June 2025, Cyprus banks have responded by lowering average mortgage rates to 3.78%, making property purchases more accessible to both local and international buyers.

This monetary easing has stimulated borrowing activity, with new housing loans increasing 7.6% year-on-year to €290.1 million in Q4 2024. Banks report increased mortgage applications, particularly from first-time buyers and young families taking advantage of the improved affordability.

However, lending criteria remain strict, with banks maintaining conservative loan-to-value ratios and thorough income verification processes, reflecting lessons learned from the previous financial crisis and ensuring sustainable market growth.

What are the price differences between new and resale properties?

The Cyprus property market shows distinct pricing patterns between new developments and resale properties, each offering different value propositions.

New properties typically command 15-25% premium over comparable resale units due to modern designs, energy efficiency features, and updated technology. These properties are subject to 19% VAT (reducible to 5% for first-time buyers meeting specific criteria), significantly impacting the total purchase price. For a €300,000 new apartment, VAT alone could add €57,000 to the cost.

Resale properties offer better initial value, often priced 10-20% below new developments, and are exempt from VAT, though buyers must pay transfer fees ranging from 3-8% depending on the property value. Many resale properties require renovation, with costs typically ranging from €15,000-50,000 for modernization.

The off-plan market has gained significant traction, with buyers securing properties at current prices for delivery in 18-24 months, potentially benefiting from 10-15% appreciation by completion. This strategy has proven particularly successful in high-growth areas like Larnaca and Paphos.

Smart buyers are increasingly comparing the total cost of resale properties plus renovation against new builds, often finding that well-located resale properties offer better long-term value despite initial renovation requirements.

Which property types offer the best investment potential in 2025?

Different property types in Cyprus present varying investment opportunities based on current market dynamics and future growth projections.

Apartments emerge as the clear winner for investors, offering 5.42% rental yields compared to 3.03% for houses, with stronger capital appreciation at 8.8% annually. Urban and coastal apartments particularly excel, benefiting from high demand from young professionals and the growing tech workforce attracted by government incentives.

Off-plan developments represent another compelling opportunity, especially in emerging areas like Larnaca where airport expansion and infrastructure improvements promise significant value appreciation. Buyers can secure properties at today's prices while benefiting from projected 10-15% growth by completion.

It's something we develop in our Cyprus property pack.

Short-term rental properties in tourist hotspots offer exceptional returns, with the market expected to grow 20% by 2025. Properties with smart home features, energy-efficient designs, and proximity to amenities command premium rents and stronger capital growth.

Land investment in developing areas presents a longer-term play, particularly plots suitable for residential development as supply constraints in prime locations drive developers to seek new sites.

What is the outlook for Cyprus property prices through 2026?

Market analysts project continued but moderated growth for Cyprus property prices through 2026, with annual increases expected to stabilize at 5-7%.

This sustainable growth trajectory reflects a maturing market transitioning from the rapid appreciation phase of recent years. Supporting factors include Cyprus's GDP growth projection of 3% by 2025, continued foreign investment interest, and the permanent residency program maintaining its €300,000 threshold.

Several risks could impact this outlook, including potential regulatory changes to foreign ownership rules being discussed by parliament, concerns about overbuilding in certain coastal areas, and the broader European economic environment. The government is considering measures similar to those in Spain and Greece to address local affordability concerns.

Infrastructure developments, particularly the Larnaca airport expansion and planned marina projects, should support values in specific locations. The shift toward sustainable, smart homes will likely create a two-tier market, with modern eco-friendly properties commanding increasing premiums over older stock.

Long-term fundamentals remain strong, with Cyprus maintaining its appeal as a EU base for international businesses, a tourist destination, and a gateway between Europe, Africa, and Asia.

How do Cyprus property prices compare to other European markets?

Cyprus offers competitive property prices compared to other European Union markets, providing attractive value for international investors.

At €2,518 per square meter nationally, Cyprus remains significantly more affordable than major European cities like Paris (€9,430/m²), Milan (€5,328/m²), or even neighboring Mediterranean markets. When compared to Portugal at €1,596/m², Cyprus sits in the middle range, offering EU membership benefits with reasonable entry points.

Cyprus property price growth of 5-8% annually over the past five years has outperformed the European average of 3-4%, indicating stronger investment potential. This performance reflects the island's unique advantages including favorable tax policies, no inheritance tax, low property taxes, and the attractive permanent residency program.

The rental yield comparison further favors Cyprus, with 5.42% for apartments exceeding most Western European markets where yields typically range from 2-4%. This combination of capital growth and rental income potential makes Cyprus particularly attractive for buy-to-let investors.

Despite recent price increases, Cyprus maintains its position as one of Europe's more accessible property markets, especially considering the lifestyle benefits, year-round sunshine, and strategic location it offers.

Are there signs of a property bubble or market correction in Cyprus?

While Cyprus property prices continue rising, several indicators suggest the market is transitioning to sustainable growth rather than heading toward a bubble.

The moderation in price growth from 7.7% in 2023 to 6.5% in 2025, combined with a 10% increase in building permits, indicates improving supply-demand balance. Unlike previous boom periods, current growth is supported by genuine demand from end-users and long-term investors rather than speculative activity.

Banks maintain strict lending criteria with conservative loan-to-value ratios, preventing the excessive leverage that characterized the pre-2013 crisis period. New mortgage lending growth of 7.6% remains healthy but controlled, with thorough income verification preventing risky lending practices.

Market sentiment surveys show expectations for property price increases dropped to 25.4 in December 2024 from 68 a year earlier, indicating more realistic valuations. Construction material prices stabilized at just 0.2% annual growth, reducing pressure on new development costs.

However, localized risks exist in luxury segments of Limassol where prices may have overextended, and in areas with significant new supply coming online. The key differentiator from previous bubbles is the diverse demand base, including genuine residents, retirees, tech workers, and investment migration participants.

We made this infographic to show you how property prices in Cyprus compare to other big cities across the region. It breaks down the average price per square meter in city centers, so you can see how cities stack up. It's an easy way to spot where you might get the best value for your money. We hope you like it.

What government policies might affect property prices in 2025-2026?

Several government initiatives and potential policy changes could significantly impact Cyprus property prices in the coming years.

The "Renovate-Rent" scheme offers up to €35,000 in funding for property renovations, with a €25 million budget aimed at bringing 1,000 vacant units into the affordable rental market. This initiative could ease rental market pressure while providing opportunities for investors to upgrade older properties with government support.

MPs have expressed growing concern about foreign buyers driving up prices and making homes unaffordable for locals, particularly young couples. Discussions about implementing restrictions similar to those in Finland, Greece, and Spain are ongoing, though no concrete measures have been announced.

The Housing Subsidy Scheme provides €20,000 to €50,000 grants for individuals and families under 41 years old, with amounts capped at €15,000 for one-bedroom units, €25,000 for two-bedroom properties, and €35,000 for three-bedroom homes. Applications remain open until December 31, 2025.

Tax policies remain favorable with no inheritance tax and low property taxes, though pressure for reform grows as local affordability concerns mount. Any changes to the €300,000 permanent residency threshold or introduction of additional taxes on foreign buyers could impact demand.

Which locations offer the best value for property investment in 2025?

Strategic property investors are finding exceptional value opportunities beyond the traditional hotspots of Limassol and Paphos.

Larnaca emerges as the standout value proposition with median prices at €300,000 - the most affordable among major districts - yet showing the strongest growth potential with 66.3% surge in apartment sales and 9-10% projected annual price increases. The ongoing airport expansion handling 8.1 million passengers annually creates a compelling growth story.

Famagusta represents an emerging market with median prices at €455,000, having recorded 40% sales growth in January 2025 and 11.1% annual price appreciation. Limited supply and new development activity suggest continued upward pressure on prices.

Suburban Nicosia offers stability and affordability at €320,000-350,000 median prices, with steady 5-6% growth appealing to risk-averse investors. As the capital and business center, it provides consistent rental demand from professionals and government employees.

For luxury investments, specific Limassol neighborhoods away from the saturated seafront still offer value, particularly in upcoming mixed-use developments combining residential, office, and retail spaces targeting the tech sector workforce.

The key is identifying areas with infrastructure improvements, growing employment opportunities, and reasonable entry prices relative to rental yield potential.

Get fresh and reliable information about the market in Cyprus

Don't base significant investment decisions on outdated data. Get updated and accurate information with our guide.

Get the guide

What are the hidden costs of buying property in Cyprus?

Understanding the full cost of property acquisition in Cyprus extends well beyond the advertised price, with several significant additional expenses.

For new properties, VAT at 19% represents the largest additional cost, though first-time buyers can qualify for a reduced 5% rate on properties up to €475,000 with a maximum 190m² buildable area. On a €300,000 property, this means either €57,000 or €15,000 in VAT depending on eligibility.

Resale properties avoid VAT but incur transfer fees ranging from 3% on the first €85,000, 5% on the next €85,000, and 8% above €170,000. Legal fees typically add 1% plus VAT, while property survey costs range from €300-1,000 depending on property complexity.

Ongoing costs include annual property tax (0.6-1.9% of 1980 assessed values), communal fees (€50-200 monthly for apartments), and utilities averaging €100-500 monthly depending on property size. Insurance, maintenance reserves, and property management fees for rental properties add further expenses.

Non-EU buyers must factor in the €300,000 minimum for permanent residency eligibility, plus government application fees and potential currency exchange costs that can significantly impact the total investment.

How long does it typically take to complete a property purchase in Cyprus?

The Cyprus property purchase timeline varies significantly depending on property type, financing requirements, and buyer nationality.

For cash purchases of resale properties with clear titles, transactions can complete in 4-6 weeks. This includes 1-2 weeks for due diligence and legal checks, 1-2 weeks for sales agreement preparation and signing, and 2-3 weeks for transfer deed registration and completion at the Land Registry.

New developments and off-plan purchases follow different timelines, with initial contracts signed immediately but final transfer occurring 18-24 months later upon construction completion. Buyers typically pay 20-30% upfront, with staged payments throughout construction and the balance on delivery.

Non-EU citizens require Council of Ministers approval through Form Comm.145, adding 2-3 months to the process. This runs concurrently with other procedures, so strategic planning can minimize delays. The permanent residency application, if applicable, processes separately over 2-3 months.

Mortgaged purchases extend timelines by 3-4 weeks for bank approvals, property valuations, and legal documentation. Foreign buyers should allow extra time for document authentication, translation, and potential power of attorney arrangements if not present in Cyprus throughout the process.

What makes certain Cyprus properties increase in value faster than others?

Property appreciation rates in Cyprus vary dramatically based on specific characteristics and location factors that savvy investors can identify and leverage.

Proximity to development catalysts drives the strongest appreciation, with properties near the expanding Larnaca airport, planned marina projects, or new business districts seeing 15-20% higher growth than market averages. The announcement of major infrastructure projects can trigger immediate value increases in surrounding areas.

Energy-efficient properties with A or B ratings command 10-15% premiums and appreciate faster as buyers increasingly prioritize running costs and environmental impact. Smart home features, solar panels, and efficient cooling systems particularly appeal to the tech-savvy workforce driving demand.

Properties with flexible usage potential - such as those suitable for both residential and short-term rental - show superior capital growth. Tourist license eligibility can add 20-30% to property values in coastal areas where short-term rental yields exceed long-term returns.

Title deed clarity significantly impacts appreciation, with properties having clean, transferable titles appreciating 5-10% faster than those with complications. This particularly affects older properties and some new developments where developer financial issues can cloud ownership.

The "first-mover advantage" in emerging neighborhoods consistently delivers outperformance, with early investors in now-prime areas like certain Limassol districts seeing 200-300% appreciation over the past decade.

Should investors wait for a market correction or buy now in Cyprus?

The decision to invest now or wait for a potential correction requires careful analysis of current market dynamics and individual investment objectives.

Current indicators suggest buying now offers advantages for most investors. With prices growing at a moderated 6.5% annually and interest rates declining from 4.50% to 2.15%, the cost of waiting could exceed any potential correction benefits. A 5-7% annual appreciation means a €300,000 property could cost €315,000-321,000 by next year.

Market fundamentals remain strong with GDP growth projected at 3%, tourism at record levels, and the tech sector expansion continuing. Unlike previous boom-bust cycles, current growth stems from diverse, sustainable demand sources rather than speculation, reducing correction probability.

However, luxury properties in oversupplied Limassol areas may face near-term pressure, suggesting selective waiting in this segment. Similarly, investors focused solely on capital appreciation might consider waiting for potential regulatory changes affecting foreign ownership.

For rental income investors, lifestyle buyers, and those seeking permanent residency, current market conditions offer compelling opportunities. The combination of rising rents (5.42% yields), declining mortgage rates, and strong currency (Euro) creates favorable entry conditions that may not persist.

The key is selecting the right property type and location rather than timing the market perfectly.

Conclusion

This article is for informational purposes only and should not be considered financial advice. Readers are advised to consult with a qualified professional before making any investment decisions. We do not assume any liability for actions taken based on the information provided.

Sources

1. Cyprus Property Prices in 2025: Real Estate Costs Index
2. Cyprus property market outlook 2025! - Louvias Properties
3. Cyprus property market update – April 2025 - Cyprus Property News
4. 17 strong trends for 2025 in the Cyprus property market – Investropa
5. House prices in Cyprus continue to rise, but at a slower rate - Cyprus Property News
6. Cyprus real estate investment in 2025: prices, yields, and taxes
7. Cyprus Real Estate Prices March 2025: Market Trends & Analysis
8. Cyprus Real Estate Market Trends: What to Expect in 2025 - NiSea Realty
9. Cyprus Property Market Sees Strong Start in 2025 - La Maison Estates
10. Maximizing Rental Yields in Cyprus in 2025 - Square One
11. Cyprus's Residential Property Market Analysis 2025
12. House prices in Cyprus - 2025 - The Complete List
13. 7 statistics for the Cyprus real estate market in 2025 – Investropa
14. Housing market slows with lowest price growth since 2022 - Cyprus Property News