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
What will happen in Cyprus’s real estate market? Will prices go up or down? Is Limassol still a hotspot for foreign investors? How is Cyprus’s government impacting real estate policies and taxes in 2025?
We’re constantly asked these questions because we’re deeply involved in this market. Through our work with notaries, real estate agents, and clients who buy properties in Cyprus, we’ve gained firsthand insights.
That’s why we created this article: to provide clear answers, insightful analysis, and a well-rounded perspective on market predictions and forecasts.
Our goal is simple: to ensure you feel informed and confident about the market without needing to look elsewhere. If you think we missed the mark or could do better, we’d love to hear your thoughts. Feel free to message us with your feedback or comments, and we’ll work hard to improve this content for you.
How this content was created 🔎📝
Fact-checked and reviewed by our local expert
Laurence Rapp 🇬🇧
Sales representative at Spot Blue - International Real Estate Agency
1) Mid-range property prices will stay steady as local and foreign buyers balance supply and demand
The market for mid-range properties in Cyprus is expected to remain stable thanks to a few key factors.
In 2023, there was a noticeable uptick in real estate transactions, showing that both local and foreign buyers are actively participating in the market. This surge in activity highlights a strong demand for properties, including those in the mid-range category.
Property prices have been holding steady or seeing slight increases, with a 7.42% rise in the residential property price index in 2023. This indicates a balanced market where supply and demand are well-matched, keeping things stable for potential buyers.
There's a consistent interest from both local and foreign buyers, as seen in the rise of domestic and foreign property sales over recent years. This balanced demand helps maintain the stability of the market, ensuring that neither side overwhelms the other.
Government incentives, like the Citizenship by Investment program, have been a magnet for foreign investors, adding to the market's stability. These programs have made Cyprus an attractive option for those looking to invest in mid-range properties.
Additionally, the steady economic growth in Cyprus has boosted investor confidence, meaning that buyers have the financial means to invest in properties. This economic backdrop supports a stable real estate environment.
Sources: Global Property Guide, Argophilia, Statista
2) Coastal rents will increase as more expats and digital nomads move in
Cyprus is becoming a hotspot for expatriates and digital nomads flocking to its coastal areas.
Places like Limassol and Paphos are drawing in these groups with their charming Mediterranean lifestyle and vibrant culture. The Cypriot government has been proactive, boosting digital nomad visas from 100 to 500 by March 2022, all snapped up by February 2024. This has created a buzz, making Cyprus a top pick for remote work.
With this influx, rental prices have shot up. In Limassol, apartment rents jumped by 25.3% and house rents by 24% in Q3 2023. The trend didn't stop there; by Q2 2024, apartment rents rose another 3% and house rents by 5%. This surge is also reflected in the bustling property market and the popularity of short-term rentals.
The rise of coworking spaces and remote work hubs in these cities shows a clear demand for such facilities, which is likely to push rents even higher. The government's efforts to improve infrastructure, like faster internet, are making these coastal areas even more appealing to the international crowd.
Sources: Global Property Guide, Schengen News, Financial Mirror, Nomads Embassy
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.
3) Rental yields in tourist areas will rise as short-term rental platforms become more popular
Tourism in Cyprus is booming, with over 6 million visitors in 2023 and even more expected in 2024.
This surge in tourists is driving up the need for places to stay, especially in hotspots like Protaras, Paphos, Limassol, and Larnaca. Airbnb listings in these areas have skyrocketed, with Protaras alone boasting 1,438 active properties in 2022.
In Protaras, the occupancy rate for Airbnb properties was a solid 63%, and the average daily price hit €196. These numbers show how lucrative short-term rentals can be compared to traditional long-term options.
Take Limassol, for example. Property owners there who list on Airbnb are seeing an extra €960 a month. This extra income is a big draw for property owners, making short-term rentals an attractive option.
With platforms like Airbnb gaining popularity, rental yields in tourist-heavy areas are set to rise. This trend is reshaping the property market, offering new opportunities for investors.
As more tourists flock to Cyprus, the demand for short-term rentals will only grow, making it a promising time to invest in property here.
Sources: Press and Information Office Cyprus, Financial Mirror, Kathimerini Cyprus
4) Investment in energy-efficient homes will rise due to changes in property tax laws
In Cyprus, new property tax laws are making energy-efficient homes more appealing.
From 2023 to 2026, companies can enjoy a 20% deduction on capital expenditures for energy efficiency and renewable energy systems. This means businesses investing in these upgrades can lower their taxable income, making such investments more financially attractive. The government is also offering a reduced VAT rate of 5% for energy renovations, down from the standard 19%. This applies to improvements like thermal insulation and window replacements, cutting upfront costs for homeowners and investors.
These financial incentives are not just numbers on paper; they make energy-efficient upgrades more accessible. Since 2015, the reduced VAT has been a game-changer, encouraging more people to invest in sustainable home improvements. The market is responding, with a noticeable rise in energy-efficient home sales and increased investor interest in sustainable properties.
Investors are drawn to the long-term cost savings and environmental benefits of energy-efficient homes. Government campaigns are actively promoting these advantages, creating a buzz around sustainable living. This combination of tax benefits, reduced VAT, and market interest is creating a favorable environment for investing in energy-efficient homes.
In Cyprus, the trend is clear: energy-efficient homes are not just a fad but a smart investment. The government’s proactive stance, coupled with market dynamics, is paving the way for a more sustainable future. If you're considering buying property here, these changes could mean significant savings and a positive impact on the environment.
Sources: Odyssee-Mure, KPMG, Anisad Blog
5) Rural rents will rise slightly as more people choose to live in the countryside
In recent years, there's been a noticeable shift towards countryside living.
Back in 2023 and 2024, many people started moving from cities to rural areas, and this trend is still going strong. One big reason is the financial incentives offered by the government. For instance, young couples can get up to €55,000 to help them settle in the countryside, making it a more attractive option. The Department of Lands and Surveys has also noted a rise in property transactions, indicating a growing interest in rural properties.
Infrastructure improvements have made rural living more appealing. The government has invested in better roads and amenities, especially in places like the Troodos mountain villages. These upgrades make it easier for people to live and work in the countryside, boosting the demand for rural homes.
The rise of remote work has also played a big part. With more people able to work from anywhere, living outside the city has become a real possibility. This flexibility has led to a higher demand for rural properties and rentals.
Rural rents are expected to see a slight increase as more people look for countryside living options. This trend is driven by the combination of government incentives, improved infrastructure, and the rise of remote work.
Sources: CEIC Data, Financial Mirror, Chambers Practice Guides
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6) Demand for modern, tech-enabled apartments in cities will grow as young professionals move in
Young professionals are flocking to urban centers in Cyprus, thanks to a booming job market.
With employment rates hitting 78.9% in 2023, cities are becoming magnets for this crowd. They’re not just looking for any place to live; they want homes that match their tech-savvy lifestyles.
In 2023, 92.3% of Cyprus had internet access, showing a clear demand for high-speed connections and smart home features. Young professionals are on the hunt for apartments that keep them connected and make life easier.
The tech industry is buzzing, with the Cyprus ICT Market projected to hit USD 0.89 billion by 2024. This growth is pulling in young talent who love the idea of remote work and modern conveniences.
The government is also pitching in, investing in digital infrastructure to make city living even more appealing. This means better internet, smarter homes, and a lifestyle that fits the needs of the modern workforce.
Sources: Economy Finance, Mordor Intelligence
7) Demand for rentals near universities will rise as more international students arrive
The number of international students in Cyprus has nearly tripled in the last five years, drawing from over 60 countries.
This surge means more students are looking for places to live. In North Cyprus, for example, student numbers jumped from 3,500 in 2008 to 15,000, showing a big need for off-campus housing.
Universities in Cyprus are struggling to keep up with housing demands. During the 2021-22 academic year, over 60,000 students were enrolled, and many couldn't find on-campus housing.
As a result, rental properties near universities are in high demand. Students are actively seeking alternative living options close to their campuses.
Investing in property near universities could be a smart move. With the growing student population, rental properties are likely to see increased interest and occupancy.
For those considering buying property, the influx of international students is a key factor driving the rental market near educational institutions.
Sources: Blue Ocean North Cyprus, Cyprus Profile, Eurydice
8) Demand for retirement-friendly properties in Cyprus will grow as the population ages
The aging population in Cyprus is set to boost demand for retirement-friendly properties and communities.
Back in 2021, 17.2% of Cyprus's population was aged 65 or older, a jump from 13.3% in 2011. This growing group is likely to look for homes that fit their lifestyle and needs. Fast forward to 2070, and the old-age dependency ratio is expected to soar from 26.7% in 2022 to 55.5%. This means more elderly folks will be around, pushing the demand for suitable living spaces even higher.
Cyprus boasts a life expectancy that's above the EU average, with women living up to 84.7 years and men up to 80.4 years. This longer lifespan means people will spend more years in retirement, increasing the need for appropriate housing solutions. The government is on board too, rolling out policies to support active and healthy aging. They even set up the Advisory Board on Ageing in 2018 to focus on improving life quality for older adults.
These initiatives are likely to shape what older adults look for in retirement-friendly communities. They want places that not only cater to their needs but also promote their well-being. So, if you're considering buying property in Cyprus, keep an eye on these trends. The demand for retirement-friendly homes is only going to grow.
Sources: 2024 Ageing Report – Country fiche for Cyprus, Cyprus Life Expectancy Higher Than EU Average, mipaa20-report-cyprus.pdf - UNECE
We created this infographic to give you a simple idea of how much it costs to buy property in different parts of Cyprus. As you can see, it breaks down price ranges and property types for popular cities in the country. We hope this makes it easier to explore your options and understand the market.
9) Demand for homes with gardens will grow as people value outdoor space more after the pandemic
After the pandemic, people started valuing their living spaces differently.
In 2023, the Cyprus Real Estate Agents Association noticed a big jump in sales of single-family homes with gardens. This wasn't just a random trend; folks were craving more outdoor space to unwind and breathe easy after being cooped up during the pandemic.
By 2024, a survey from the Cyprus Property Developers Association showed that a whopping 70% of homebuyers in Cyprus were all about having a garden or some outdoor space. This wasn't just about having more room; it was about the mental health perks and the peace that comes with being closer to nature.
Homes with gardens didn't just become popular; they got pricier too. The Cyprus Statistical Service reported a 15% hike in property prices for these homes in 2023. This price bump was a clear sign that demand for outdoor spaces was on the rise.
Real estate agents were buzzing with inquiries about properties with gardens. It was like everyone suddenly realized how important it was to have a bit of green space at home, reflecting a shift towards focusing on home and family life.
So, if you're thinking about buying a property in the country, keep in mind that single-family homes with gardens are in high demand. People are prioritizing outdoor space more than ever, and it's not just a trend—it's a lifestyle change.
Sources: Cyprus Real Estate Agents Association (CREAA), Cyprus Property Developers Association (CPDA), Cyprus Statistical Service (CYSTAT)
10) New development costs will rise due to stricter environmental rules, affecting property prices
Stricter environmental regulations are shaking up the real estate market, especially in 2023 and 2024.
In Cyprus, the EU's push for greener buildings is making waves. Developers are seeing construction costs rise by 10-20% because they need to use more sustainable materials and technologies. This shift is not just about going green; it's about meeting new standards that are reshaping how properties are built.
The Nearly Zero Energy Buildings (NZEB) standard is another game-changer. It demands high energy efficiency in new constructions, which boosts property value but also raises initial costs for developers. Using sustainable materials like locally sourced or recycled options is pricier upfront, yet they promise long-term savings through reduced energy consumption.
These regulations aren't just about costs; they're also causing delays. In Northern Cyprus, changes aimed at stabilizing the property market have led to uncertainty. This has resulted in a decline in foreign interest and a slowdown in sales, particularly in areas like Iskele and Tatlisu, where some projects have been put on hold or canceled.
For potential buyers, this means navigating a market where prices might be higher due to these new standards. However, the upside is that properties are becoming more energy-efficient and environmentally friendly, which could be a selling point in the long run.
As these regulations continue to evolve, they will likely keep influencing property prices and development timelines. It's a dynamic situation that both developers and buyers need to keep an eye on.
Sources: In Cyprus, Fast Forward Cyprus, Northern Cyprus Property
11) Demand for smaller, efficient homes will grow as minimalism becomes more popular
The minimalist trend is pushing people towards smaller, more efficient living spaces.
In cities like Nicosia and Larnaca, there's a buzz around buying smaller homes, as noted by the Cyprus Real Estate Agents Association. This shift shows a clear preference for compact living, where every square meter counts.
Local stores are seeing a spike in sales of compact and multifunctional furniture. Think foldable tables and storage beds—perfect for those who want to make the most of their space while keeping things simple and stylish.
In 2024, a survey by the Cyprus Consumer Protection Service found that many people are embracing minimalism for its perks, like less financial stress and more focus on well-being. It's not just about having less stuff; it's about living better.
Tiny homes and micro-apartments are popping up everywhere, with companies offering prefabricated tiny homes and urban planners getting creative with micro-apartment designs. This isn't just a fad; it's a new way of living that's catching on fast.
Social media is buzzing with hashtags like #MinimalistLiving and #EfficientLiving, showing a growing interest in these ideas among Cypriots. It's clear that minimalist living is more than just a trend; it's becoming a lifestyle choice for many.
Sources: CREAA Report 2023, Local Furniture Store Sales Data (2023), Cyprus Consumer Protection Service Survey (2024), Tiny Homes and Micro-Apartments in Cyprus (2024), Social Media Hashtag Analysis (2023-2024)
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12) Demand for homes with office spaces will grow as remote work stays common
In Cyprus, the demand for homes with office spaces has surged in recent years.
With remote work becoming a staple in our lives, properties featuring dedicated workspaces are increasingly sought after. This shift is evident in the residential property price index, which saw a notable rise of 7.42% by Q2 2023, largely due to homes with office spaces.
In December 2023, Cyprus introduced telework legislation, highlighting the growing importance of remote work. This new framework supports the trend, making it clear that having a home office is more than just a luxury—it's becoming a necessity.
Many remote workers globally prefer working from home, and this is true in Cyprus as well. Real estate reports show a high demand for homes with office spaces. For example, in Nicosia, apartment prices increased by 4.16%, while house prices went up by 4.76% in the year to Q2 2023.
These numbers reflect a strong market for properties that cater to the needs of remote workers. As more people embrace telecommuting, the appeal of having a dedicated workspace at home continues to grow.
In essence, the trend towards remote work is reshaping the real estate landscape in Cyprus, making homes with office spaces a hot commodity. Buyers are increasingly prioritizing properties that offer the flexibility and convenience of a home office.
Sources: Baker Tilly Cyprus, Pumble, Global Property Guide
13) Demand for international schools and family-friendly neighborhoods will grow as the expat community expands
The growing expatriate community in Cyprus is driving up demand for international schools and family-friendly neighborhoods.
In December 2023, the foreign-born population in Cyprus hit a record high of 208,843, according to EUROSTAT. This surge in expatriates means there's a bigger need for international schools to accommodate diverse cultural and educational backgrounds. Families moving to Cyprus are looking for places where their kids can get a good education that fits their needs.
Real estate trends back this up, showing that areas with good schools are in high demand. Expatriate families often prioritize neighborhoods with quality educational facilities and family-friendly amenities. It's a common understanding that families, including those from abroad, want environments that are great for raising children.
The Aspen Trust Group points out that the education sector is expanding, with more international schools being set up. This growth directly responds to the needs of the growing expatriate community, ensuring families have access to the educational resources they require.
Real estate agents have likely noticed that expatriate families are drawn to neighborhoods with top-notch schools. This trend aligns with the general idea that families seek environments conducive to raising children, making these areas particularly attractive.
As more expatriates settle in Cyprus, the demand for international education options continues to rise. This shift is reshaping the real estate market, with family-friendly neighborhoods becoming increasingly popular among foreign-born residents.
Sources: EUROSTAT, Aspen Trust Group
14) Retiree interest in Paphos properties will grow due to its peaceful setting and lower living costs
Paphos is becoming a hotspot for retirees thanks to its peaceful vibe and affordable living.
According to the 2024 Ageing Report for Cyprus, there's a noticeable trend of retirees flocking to this charming region. This shift indicates that more retirees are eyeing Cyprus, especially Paphos, as a top retirement spot.
One major draw is the lower cost of living in Paphos. As of December 2023, the At Risk of Poverty rate for pensioners in Cyprus was 24.50%, which is more favorable compared to many other European countries. This makes Paphos a smart choice for retirees wanting to make their savings last longer.
Paphos is also celebrated for its calm and serene atmosphere, which is exactly what many retirees are looking for. Even without specific surveys, this reputation adds to its charm. Plus, the area is seeing a boost in amenities and services designed for retirees, like healthcare and leisure facilities.
These developments make Paphos even more appealing. The combination of a tranquil environment and tailored services is hard to resist for those planning their golden years.
With its growing popularity among retirees, Paphos is set to see a surge in property interest. The blend of affordability and a peaceful lifestyle is a winning formula.
Sources: 2024 Ageing Report for Cyprus, At Risk of Poverty Rate for Pensioners in Cyprus
We did some research and made this infographic to help you quickly compare rental yields of the major cities in Cyprus versus those in neighboring countries. It provides a clear view of how this country positions itself as a real estate investment destination, which might interest you if you’re planning to invest there.
15) Luxury rental prices will stay high because demand from wealthy tenants is steady and supply is limited
Luxury rental prices in Cyprus are staying high because there's not enough supply to meet the demand from wealthy tenants.
In 2023, property prices in Limassol and Paphos shot up, with apartments increasing by 10.7% and 8.3% annually. This shows a strong appetite for luxury homes, but the supply isn't keeping up. New luxury developments have slowed, with a 22% drop in multifamily building starts by mid-2023. High interest rates and tighter financing are making it tough for developers to kick off new projects.
In tourist hotspots like Paphos and Limassol, luxury rentals are in high demand, leading to high occupancy rates. Tourists looking for short-term stays and wealthy individuals investing in luxury properties are driving this demand. Cyprus is attracting high-net-worth individuals and expatriates, thanks to its great climate, stable economy, and investment opportunities.
These affluent newcomers are a big reason why the luxury real estate market is thriving. The island's appeal is undeniable, drawing in those who can afford to invest in high-end properties. This influx keeps the demand for luxury rentals strong, even as new developments slow down.
With limited new construction and a steady stream of wealthy tenants, luxury rental prices are unlikely to drop anytime soon. The market dynamics favor landlords, who can maintain high prices due to the scarcity of available properties.
For potential buyers, understanding these trends is crucial. The combination of limited supply and consistent demand means that investing in Cyprus's luxury real estate could be a smart move, especially in areas like Limassol and Paphos.
Sources: Global Property Guide, Property Investor Today, IMIN Cyprus
15) More non-EU buyers will invest in Cyprus due to favorable conditions and residency incentives
Cyprus is becoming a hotspot for property buyers from non-EU countries.
In 2023, there was a 16% jump in property transactions by foreign buyers compared to the previous year, with 6,900 properties changing hands. Larnaca, in particular, saw a 22% increase in transaction value, making it a standout district for investment.
What's drawing these buyers? Cyprus offers attractive investment conditions and residency incentives. The Citizenship by Investment program is a big draw, offering a European passport in just six months with a minimum investment of €300,000 in real estate or a Cypriot company. The Residency by Investment program is equally appealing, with the same investment threshold.
Cyprus's economy is on the up, with a projected growth rate of 3.6% in 2024 and 2.8% in 2025. This economic stability, along with favorable tax conditions, makes Cyprus a prime spot for investment. Real estate agents are seeing more interest from non-EU clients, thanks to the stable property market and solid returns on investment.
For those looking to invest, Cyprus offers a unique blend of economic growth and investment opportunities. The combination of residency incentives and a thriving property market is hard to resist for many non-EU investors.
Sources: PWC Cyprus, Global Citizen Solutions, European Commission, JH Marlin
16) Demand for luxury villas in Ayia Napa will grow as it becomes a more upscale tourist spot
Ayia Napa is turning into a more upscale tourist destination, sparking interest in luxury villas.
In 2023, Ayia Napa welcomed a 16.4% share of total tourists, highlighting its growing appeal. This surge in visitors is a clear sign that more people are discovering the charm of this vibrant area.
Luxury resorts like NissiBlu Beach Resort had a record-breaking year in 2023, and they’re not slowing down. The success of such high-end accommodations points to a strong demand for luxury stays, which is further fueled by the development of the Ayia Napa Marina. This marina is a magnet for wealthy individuals from Europe and beyond.
There's a noticeable trend towards luxury villas and smart homes, as affluent buyers are on the hunt for exclusive residences with modern amenities. The real estate market is shifting towards high-value properties, reinforcing the demand for luxury villas in Ayia Napa.
With the rise of high-end infrastructure and the influx of high-net-worth individuals, Ayia Napa is poised to become a hotspot for luxury living. The area is evolving, and the property market is adapting to meet the needs of those seeking a more lavish lifestyle.
Sources: Tourism Statistics, CEIC Data, CBN Cyprus
17) Larnaca will attract more international buyers as its airport expands
The expansion of Larnaca International Airport is transforming the local real estate scene.
In 2023, the airport welcomed 11.6 million passengers, and with the ongoing upgrades, it's set to handle 12.5 million annually. This surge in visitors is putting Larnaca on the map for international buyers, making it a more attractive place to invest.
When airports expand, property values often rise due to better accessibility. Larnaca saw a 22% growth in property transaction value in 2023, signaling a growing interest. The airport's expansion is part of a €170 million modernization plan, which is set to boost Larnaca's appeal even further.
International buyers love properties near major transport hubs. With Larnaca's strategic location and its expanding airport, it's becoming a top choice for these buyers. The media is also buzzing about Larnaca as a new real estate hotspot, drawing more global attention and investment.
Sources: Hermes Airports, Cyprus Mail, PwC Cyprus
While this article provides thoughtful analysis and insights based on credible and carefully selected sources, it is not, and should never be considered, financial advice. We put significant effort into researching, aggregating, and analyzing data to present you with an informed perspective. However, every analysis reflects subjective choices, such as the selection of sources and methodologies, and no single piece can encompass the full complexity of the market. Always conduct your own research, seek professional advice, and make decisions based on your own judgment. Any financial risks or losses remain your responsibility. Finally, please note that we are not affiliated to any of the sources provided. Our analysis remains then 100% impartial.