Authored by the expert who managed and guided the team behind the Cyprus Property Pack
Yes, the analysis of Nicosia's property market is included in our pack
What will happen in Nicosia’s real estate market? Will prices go up or down? Is Nicosia 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 Nicosia, 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.
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1) More non-EU buyers will invest in Nicosia properties to gain residency
Interest from non-EU buyers in Nicosia is on the rise as they look to gain residency through property investment.
In 2023, Cyprus saw a 16% increase in foreign buyers, with non-EU buyers making up a significant 72% of this market. This trend didn't slow down in 2024, as 1,033 properties were snapped up by non-EU purchasers in just the first quarter. The allure? A chance to live in a vibrant city with a rich history and a strategic location.
The Cyprus Residence by Investment Programme is a major draw, offering a fast track to residency with a minimum investment of €300,000. This program is a hit among non-EU buyers, who can choose from a range of investments, including both residential and commercial properties. Imagine owning a piece of the Mediterranean while securing a new home base.
Cyprus's real estate market is thriving, thanks to favorable investment conditions and enticing residency incentives. The Citizenship by Investment program sweetens the deal even more, offering a European passport with a minimum investment. This makes Cyprus a hotspot for non-EU investors looking for both a home and a gateway to Europe.
Sources: Property Guides, IMI Daily, Cyprus Property Buyers
2) Mid-range rental prices in Nicosia will rise slightly as demand remains steady
Nicosia has been experiencing steady population growth, which naturally increases the demand for housing. As more people move into the city, the need for rental properties rises, pushing prices up. This trend was already noticeable in 2023 and 2024, and it is expected to continue.
The city is also attracting a significant number of expatriates and international students. With nearly half of the schoolchildren in Nicosia coming from migrant backgrounds, it's clear that the influx of new residents is substantial. This demographic shift contributes to the demand for mid-range rental properties, as these groups often seek affordable yet comfortable living options.
Moreover, the availability of new rental properties has been limited. In 2023, there was a 7.1% drop in residential building permits, indicating a shortage in new housing developments. This limited supply, combined with the rising demand, naturally leads to an increase in rental prices.
Cyprus has also been experiencing economic growth, with GDP expected to rise from 2.4% in 2023 to 3% by 2025. This economic boost is creating more job opportunities, particularly in urban areas like Nicosia, attracting young professionals who are likely to rent rather than buy. The development of business hubs further enhances this trend, making the city a hotspot for rental demand.
Sources: M Residence, Cyprus Mail, Realty Cyprus
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.
3) Demand for rentals in Engomi will rise as its location near universities attracts more student renters
The Engomi neighborhood is set to become a hot spot for property buyers due to its strategic location near universities.
Engomi is particularly attractive because of its proximity to the University of Nicosia, which has seen a boom in student numbers, now boasting over 7,265 students. This influx of students is a major driver for housing demand in the area.
What makes Engomi even more appealing is its upscale vibe, nestled in a lively part of Nicosia. The University of Nicosia's campus is a hub of activity with over 20 buildings and a variety of dining and entertainment options, making it a magnet for students looking for off-campus living.
The university isn't just large; it's the biggest in Southern Europe that primarily teaches in English, hosting more than 12,500 students from over 100 countries. This international mix adds to the housing demand, as many students prefer the convenience and social perks of living nearby.
For those considering investing in property, Engomi offers a unique opportunity. The neighborhood's charm and its close-knit student community make it a desirable location for student renters.
With its vibrant atmosphere and strategic location, Engomi is not just a place to live; it's a lifestyle choice that appeals to a diverse student population, ensuring a steady demand for housing.
Sources: University of Nicosia Accommodation, Edurank, Times Higher Education
4) Tax incentives for first-time buyers will boost Nicosia's entry-level property market
New tax incentives for first-time buyers in Nicosia are set to shake up the entry-level property market.
In 2023, Cyprus saw a 29.6% jump in property sales, and the trend continued with a 19% rise in the first ten months. This surge shows a growing interest in owning homes, especially in the affordable sector.
Banks in Cyprus are making it easier for newcomers by offering special mortgage programs for new buildings. With rates between 1.9% and 4.5% and higher approval chances due to developer guarantees, first-time buyers have a better shot at securing financing.
The government is also stepping in with a subsidy program for young families, helping cover costs for building or buying a home. This is part of a larger plan to tackle affordability, encouraging young adults to dive into the property market.
Real estate analysis highlights a shift towards affordable housing, thanks to government initiatives and favorable tax policies. This shift is expected to boost long-term demand, making it easier for first-time buyers to find a home.
These changes are creating a buzz in the market, with more people eyeing entry-level properties. The combination of tax incentives, mortgage options, and subsidies is making homeownership more accessible than ever.
Sources: Cyprus Mail, Global Property Guide, IMIN Cyprus
5) Mid-range property prices in Nicosia will stay stable as supply and demand balance out
The mid-range property market in Nicosia is set for stable prices as supply and demand find their sweet spot.
In 2023, Nicosia saw a boom in property transactions, with 5,130 sales marking an 84% jump from the previous year. This momentum carried into 2024, with transactions climbing another 13.6%, reaching 3,527 sales. Such activity hints at a lively market where buyers and sellers are actively engaging.
Building permits in Nicosia also surged by 34% in the first half of 2024 compared to the same period in 2023. This uptick in permits suggests that developers are keen to meet the growing interest from buyers, ensuring that new properties are ready to hit the market.
Government data backs up this balance, showing that the rise in both property transactions and building permits means the supply of mid-range properties is keeping pace with demand. This is a good sign for potential buyers looking for stability in their investments.
Steady economic growth in Cyprus has played a role in this equilibrium, boosting investor confidence. With a healthy economy, buyers have the financial means to invest in properties, further supporting the market's stability.
For those considering a property purchase in Nicosia, this balanced market offers a promising landscape. The ongoing development activity and economic stability suggest that now might be a good time to explore opportunities in this vibrant city.
Sources: The Luxury Playbook, Investment Cyprus, Global Property Guide
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6) Property prices in Nicosia will keep rising because demand is higher than supply
Residential property prices in Nicosia are on the rise, and this trend shows no signs of slowing down.
One key reason is the increasing demand for housing. In the third quarter of 2023, house prices in Nicosia went up by 0.3% quarterly and 3.8% annually, while apartment prices saw a 1.5% quarterly and 4.6% annual increase. This demand is driven by a mix of locals and newcomers looking for homes in the city.
Adding to the price surge is the limited availability of new housing developments. Central Nicosia is running out of land for new projects, which means fewer homes are being built. This scarcity, coupled with a steady stream of new residents due to migration, keeps pushing prices higher.
Government policies are also a factor. They offer incentives for foreign investment in real estate, attracting international buyers. This influx of foreign interest is another reason property prices are climbing. Plus, as Cyprus's economy recovers, people feel more confident about spending, which boosts demand for homes in Nicosia.
For those considering buying property in Nicosia, it's worth noting that the city's appeal is growing. With its vibrant culture and strategic location, more people are choosing to live and invest here, further driving up demand.
Overall, the combination of rising demand and limited supply suggests that residential property prices in Nicosia will continue to increase.
Sources: Central Bank of Cyprus, Macrotrends
7) Rents in Nicosia will rise as more international students and expats move in
Rents in Nicosia have been on the rise, and this trend is likely to continue as the city becomes increasingly attractive to international students and expatriates. In 2023, the University of Cyprus and Cyprus International University both reported significant increases in international student enrollment. This influx of students creates a higher demand for rental properties, as they seek accommodation close to their universities.
Moreover, the foreign-born population in Cyprus reached a record high in December 2023, indicating a growing number of expatriates moving to Nicosia for work. This is supported by economic reports highlighting Cyprus's strong job market, which draws foreign workers to the city. As more expatriates settle in Nicosia, the demand for housing continues to rise, further driving up rental prices.
Additionally, the rental market in Nicosia has been experiencing high occupancy rates, with many properties being rented out quickly. This is due to the limited availability of housing and the increasing demand from both local and international tenants. Real estate market analyses also indicate a housing shortage, particularly in the city center, which contributes to the upward pressure on rental prices.
Sources: Global Property Guide, Trading Economics, Global Property Guide
8) Luxury rental prices in Nicosia will dip slightly due to market saturation
In 2023 and 2024, we saw a significant increase in the construction of luxury apartments and homes in Nicosia. Developments like The Landmark Nicosia contributed to a growing supply of high-end properties. This oversupply is a key factor that can lead to a slight decline in rental prices as more units become available.
As these new luxury properties were built, vacancy rates in the high-end rental market began to rise. With more empty apartments, landlords started offering discounts or incentives to attract tenants, which further reduced rental prices. This trend was evident as more luxury developments neared completion, adding to the existing stock and potentially leading to a surplus.
Additionally, consumer surveys indicated a shift in preference towards more affordable housing options. This change in renter preferences decreased the demand for luxury rentals, causing prices to decline. The increased competition among landlords also led to rental incentives, such as discounts and perks, driving down prices even more.
Sources: Cyprus Property Cost Guide, The Landmark Nicosia Completion, Future Media Figures
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.
9) Property interest in Kaimakli will grow as urban renewal projects make it more attractive
Kaimakli is buzzing with urban renewal projects, making it a hot spot for potential property buyers.
Since 2023, the Nicosia Municipality has been on a mission to breathe new life into Kaimakli, focusing on transforming neglected areas into vibrant spaces. A €150 million loan from the EU underscores the serious commitment to this transformation, part of a larger plan to rejuvenate municipalities across Cyprus.
These efforts are not just about aesthetics; they’re about creating a thriving community. The municipality is offering incentives of up to €80,000 to businesses willing to set up shop in the old town, including Kaimakli. This move is designed to boost property development and draw more interest to the area.
For those considering a property investment, Kaimakli presents a unique opportunity. The area is set to become more appealing as these urban renewal projects progress, making it a prime location for both residential and commercial investments.
Insiders know that Kaimakli’s charm lies in its blend of old-world character and new-world convenience. As the area undergoes this transformation, property values are expected to rise, offering a promising return on investment.
With the backing of substantial financial support and strategic planning, Kaimakli is poised to become a sought-after destination for property buyers looking for a blend of tradition and modernity.
Sources: EIB, Fast Forward, Offer.com.cy
10) Property interest in Dasoupoli will grow as transportation links improve
In recent years, Dasoupoli has become a focal point for property interest, largely due to significant improvements in transportation links. Back in 2023 and 2024, the Nicosia Integrated Mobility Master Plan (IMMP) laid the groundwork for this transformation by developing new public transit routes and stations. This initiative aimed to enhance mobility and reduce the dependency on private cars, making Dasoupoli more appealing to potential residents and investors.
Moreover, the IMMP's proposal to create high-frequency and high-capacity transit lines connecting peripheral areas with the city center has been a game-changer. This improvement in public transport efficiency has made Dasoupoli more accessible, attracting both residents and investors who value convenience and connectivity. The trend of rising property prices in neighborhoods with similar transportation improvements further supports the expectation of increased property interest in Dasoupoli.
Additionally, the implementation of advanced traffic management systems and traveler information services, as part of the EU INTEREG Programme, has played a crucial role in reducing commute times. This enhancement has made Dasoupoli a more attractive option for those seeking a balance between work and home life, further driving interest in the area.
Sources: IMMP Final Report, ULI Real Estate Economic Forecast Spring 2024, EU INTEREG Programme
11) Older, less efficient properties in Nicosia will cost more due to stricter environmental regulations
Stricter environmental regulations in Nicosia are set to increase the cost of older, less efficient properties. This is primarily due to the new energy efficiency standards that have been implemented. By 2030, all new buildings in Cyprus must be zero-emission, and existing buildings undergoing major renovations must meet these standards, focusing on insulation and renewable energy systems.
Retrofitting older properties to meet these new standards is expected to be costly. Construction costs in Cyprus are projected to rise by 10-20% due to climate changes and EU requirements for greener buildings. For instance, purchasing a property worth 350,000 euros might require an additional 50,000 euros for insulation materials and modern energy systems, leading to a 20% increase in the price of eco-friendly properties.
Moreover, properties that do not comply with the new energy efficiency standards will likely face higher utility costs. This includes increased heating and cooling expenses due to inefficient systems. Additionally, non-compliance could lead to increased property taxes or penalties, further incentivizing property owners to invest in retrofitting their properties.
Sources: TEFL Cyprus, CA-EPBD, In-Cyprus
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12) Interest in eco-friendly housing in Nicosia will grow as more foreign investors get involved
Foreign investors are likely to show growing interest in Nicosia's eco-friendly housing projects for several reasons. First, there is a rising global demand for sustainable and eco-friendly housing. In 2025, the sustainability sector is expected to continue growing, driven by advancements in areas like regenerative agriculture and sustainable water management.
In Nicosia, developers are increasingly incorporating green building practices into their projects. This trend positions Cyprus as a leader in eco-friendly real estate, which not only boosts property values but also attracts investors interested in sustainable living. Additionally, the Cypriot government has implemented various policies and incentives to promote green building practices, such as subsidies and tax breaks, making it financially attractive for investors.
Moreover, there is a growing awareness of climate change and environmental issues among investors. Many are prioritizing sustainable and ethical products, with ESG investing expected to surge as companies integrate sustainability into their operations. This aligns with the positive media coverage on the benefits of eco-friendly housing, which highlights reduced carbon footprints and lower operational costs.
Sources: MySpace Cyprus, Sustainability Magazine, Chris Michael
13) More foreign investors will focus on Nicosia suburbs for investment opportunities
Foreign buyers are eyeing the Nicosia suburbs for some smart investment opportunities.
With property prices climbing in central Nicosia, the suburbs are becoming a more appealing and budget-friendly choice for investors. People are looking for value, and the suburbs offer just that.
There's a growing buzz around suburban living, especially since the pandemic. Folks are craving quieter, more spacious environments, and the suburbs deliver. Plus, with better roads and transport links, getting to these areas is a breeze, making them even more attractive.
The government is sweetening the deal with incentives like the Cyprus Golden Visa program. This is a big draw for international buyers, who are also noticing that rental yields are higher in the suburbs compared to the city center. It's a win-win for those looking to earn rental income.
Sources: Kathimerini Cyprus, The Future Media
14) Investment in energy-efficient homes in Nicosia will rise due to changes in property tax laws
In recent years, Nicosia has seen a shift in property tax laws that favor energy-efficient homes. This change is largely due to the Cyprus government's introduction of legislation that provides tax benefits for companies implementing energy upgrades. For instance, from 2023 to 2026, there are accelerated capital allowances of 20% for investments in technical energy efficiency systems and renewable energy systems.
This policy push towards energy efficiency is expected to encourage more companies and individuals to invest in energy-efficient properties. The amendments to the income tax law in Cyprus, which provide these accelerated capital allowances, clearly favor such investments. This creates a financial incentive for developers and homeowners to focus on energy-efficient homes.
Moreover, the trend towards tech-smart and energy-efficient apartments in Nicosia indicates a growing demand for these types of properties. This demand is likely driven by the financial benefits of reduced utility costs and the increasing awareness of the environmental impact of energy-efficient housing. As more people become aware of these benefits, the market for energy-efficient homes is expected to grow.
Sources: Baker Tilly, KPMG
We have made this infographic to give you a quick and clear snapshot of the property market in Cyprus. It highlights key facts like rental prices, yields, and property costs both in city centers and outside, so you can easily compare opportunities. We’ve done some research and also included useful insights about the country’s economy, like GDP, population, and interest rates, to help you understand the bigger picture.
15) Luxury rental yields in Nicosia will drop as supply exceeds demand
In recent years, Nicosia has seen a significant increase in luxury property developments. For instance, a new investment exceeding €60 million is in the study phase, focusing on a luxurious five-story building with apartments, office space, restaurants, and healthcare services. Additionally, another €70 million project is underway, involving the development of two residential towers with 53 apartments and office space.
Real estate platforms like Realty.com.cy have shown a growing number of luxury rental listings, indicating an increase in supply. However, consumer surveys reveal a preference for more affordable housing options, especially among students and young families who find it challenging to afford high rental prices.
Moreover, anecdotal evidence from property managers suggests difficulty in finding tenants for luxury rentals, pointing to declining occupancy rates. This is further supported by media reports highlighting an oversupply of high-end properties, which could lead to market saturation in the luxury segment.
Sources: Financial Mirror, Realty.com.cy, Dom.com.cy
16) Luxury property prices in Nicosia will drop moderately as the market adjusts from past peaks
In recent years, the luxury property market in Nicosia has been experiencing some changes. One of the key factors is the overall trend of stable growth in transaction volumes. In 2024, Nicosia recorded a 13.6% increase in total transactions compared to 2023. However, this increase does not necessarily reflect a significant rise in luxury property transactions, suggesting that the luxury segment might not be growing as rapidly as the overall market.
Another important aspect to consider is the economic environment. Although specific data on high-income growth in Cyprus is not provided, general economic trends indicate a potential slowdown. This slowdown could impact the demand for luxury properties, as high-income individuals might be more cautious with their investments. Additionally, increased interest rates can make mortgages less affordable, further reducing the demand for high-end properties.
Furthermore, a comparative analysis shows that luxury property prices in Nicosia are higher than in similar markets. For instance, while Limassol's luxury apartment prices have soared, Nicosia offers more affordable options. This price disparity might make Nicosia's luxury properties less competitive, potentially leading to a price correction. Lastly, expert opinions from industry professionals suggest that the real estate sector in Cyprus is not expected to see significant changes, implying a stabilization or correction in luxury property prices.
Sources: Cyprus Mail, Dom.com.cy, Cyprus Property News
17) Demand for modern urban apartments in Nicosia will grow as more young professionals move in
The influx of young professionals to Nicosia is set to increase the demand for modern, urban apartments due to several key factors. First, the city has seen a rise in employment opportunities, particularly through the University of Nicosia, which offers a variety of job options. This growing job market is a magnet for young professionals seeking career advancement.
Additionally, the increasing enrollment in local universities, such as the University of Nicosia, indicates that many young people are moving to the city for education. This influx of students often leads to a higher demand for urban apartments as they transition into the workforce. Moreover, government incentives for startups and tech companies in Cyprus attract businesses that typically employ young professionals who prefer modern living spaces.
The development of new business hubs and coworking spaces in Nicosia further supports this trend. These spaces cater to freelancers, startups, and remote workers, all of whom are likely to seek out modern, urban living arrangements. Surveys and global trends also show a preference among young professionals for urban living, which is likely to be mirrored in Nicosia given its expanding business and educational opportunities.
Sources: University of Nicosia Career Success Centre, University of Nicosia Enrollment Data, Cyprus Tax Incentives for Innovation, Coworking Spaces in Nicosia
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.