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 is happening in Nicosia’s real estate market? Are prices on the rise or decline? Is Nicosia still attracting foreign investors? How are local government policies and taxes shaping the real estate landscape in 2025?
These are the questions we hear every day from professionals, buyers, and sellers across the city. Maybe you’re curious about the same things.
We know this because we stay closely connected with local experts and individuals like you, exploring the Nicosia real estate market daily. That’s why we crafted this article: to offer clear answers, insightful analysis, and a comprehensive view of market trends and dynamics.
Our aim is straightforward: to make sure you feel informed and confident about the market without needing to search elsewhere. If you think we missed something or could improve, we’d love to hear your feedback. Feel free to message us with your thoughts, and we’ll strive to enhance this content for you.
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1) Rents for affordable housing will rise as demand grows
Rental prices in Nicosia have been climbing steadily over the past few years.
In 2022, apartment rents jumped by an average of 11%, and by the third quarter of 2023, they had risen another 5.5% compared to the previous year. This isn't just a blip; it's a clear trend of rising costs for renters.
Cyprus, and especially Nicosia, is seeing a steady increase in its urban population. In 2023, the urban population hit 900,959, and it's only expected to grow. More people moving to the city means more demand for housing, which naturally pushes prices up.
But here's the catch: Nicosia's supply of affordable housing is limited. This scarcity is a big deal because as more people want to live in the city, there just aren't enough homes to go around, which means rents are likely to keep climbing.
Government reports have been sounding the alarm about a housing shortage in Cyprus. This shortage is a key factor in why rents are expected to rise—there simply aren't enough homes to meet the growing demand.
So, if you're thinking about buying property in Nicosia, keep in mind that the demand for housing is outpacing supply, which is a recipe for higher rental prices.
Sources: Global Property Guide, Trading Economics, CRE Daily
2) Foreign investors in Cyprus will increase as the country strengthens ties with non-EU nations
In recent years, Cyprus has been actively working to strengthen its ties with non-EU countries through various diplomatic efforts. This includes negotiating and signing bilateral agreements aimed at enhancing economic cooperation and investment opportunities. These agreements are designed to create a more welcoming environment for foreign investors, particularly those from non-EU countries.
In 2023, the number of foreign buyers in Cyprus increased by 16% compared to the previous year, with non-EU buyers making up a significant portion of this growth. This trend continued into 2024, with a notable number of property transactions involving non-EU purchasers. Such statistics highlight the growing interest from non-EU investors in the Cypriot real estate market.
Additionally, Cyprus offers favorable tax conditions and has lifted restrictions on foreign direct investment from non-EU countries. These government incentives are designed to attract more foreign investment, making Cyprus an appealing destination for non-EU investors. The country's efforts to improve transportation links and its media coverage as a favorable investment destination further support this trend.
Sources: Property Guides, FBS Cyprus, Economy Finance
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) Foreign buyers will increasingly target Nicosia properties due to favorable tax incentives
Foreign buyers are increasingly drawn to Nicosia, thanks to Cyprus's attractive tax incentives.
In 2023 and 2024, Nicosia saw a 2% rise in foreign property purchases, even as other parts of Cyprus experienced a decline. This trend highlights the city's unique appeal in the real estate market.
One major draw is Cyprus's low corporation tax rate of 12.5%, among the lowest in the EU, making it a hotspot for tax-savvy investors. This tax advantage is a well-known secret among international buyers, who are keen to capitalize on it.
Real estate agencies like FOX Real Estate have noticed a surge in demand from international clients, reflecting the growing interest in Nicosia's property market. The city's tax-friendly environment is a significant factor driving this demand.
Moreover, the process of obtaining residency in Cyprus is relatively straightforward, adding to the allure for foreign investors. This ease, combined with the tax benefits, makes Nicosia an attractive option for those looking to invest abroad.
Government reports and economic analyses consistently emphasize these tax benefits, which continue to draw attention from international buyers. The combination of favorable tax conditions and a welcoming residency process positions Nicosia as a prime destination for property investment.
Sources: Dom.com.cy, FOX Realty, Citizenship Bay
4) City-center properties will attract more foreign buyers for better investment returns
Foreign buyers are increasingly focusing on city-center properties in Nicosia because these areas offer better investment returns. In 2023, property prices in Nicosia's city center rose significantly, with apartment prices increasing by 4.2% and house prices by 4.8%. This is in contrast to suburban areas like Strovolos and Lakatamia, which saw more modest price increases.
City-center properties in Nicosia also offer higher rental yields, averaging around 4-5%. This is largely due to the demand from professionals and students, which ensures steady occupancy rates. Additionally, the recovery of the tourism sector is expected to boost short-term rental markets, particularly in the city center, further supporting property price growth.
The limited availability of land for new developments in central Nicosia is another factor contributing to higher occupancy rates and better investment returns. This scarcity of land puts upward pressure on property prices, making city-center properties more attractive to investors. Moreover, the government's incentives for foreign investment in real estate are expected to attract international buyers, driving up property prices in the city center.
Sources: The Luxury Playbook, IAD Overseas, Grekodom
5) Engomi will attract more interest for its proximity to universities and growing student population
Engomi, a neighborhood in Nicosia, is becoming increasingly popular, especially among students. This is largely due to its proximity to universities, like the University of Nicosia, which has seen a significant rise in student enrollment. In 2024, the university had over 7,265 students, indicating a growing demand for educational services in the area.
The demand for student accommodation in Engomi is also on the rise. The University of Nicosia’s student residences, known for their modern amenities and vibrant atmosphere, are highly sought after. This suggests that Engomi is becoming a preferred location for students, which in turn drives up demand for housing and related services.
Moreover, the University of Nicosia has invested heavily in its campus infrastructure, including new student housing projects. This investment, totaling over €100 million, highlights the growing student population and the need for more accommodation options in Engomi. The development of new housing complexes like SIX, U, and TRIANGLE further supports the idea that Engomi is evolving into a hub for student living.
Sources: Edurank, University of Nicosia, eCampus News
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6) Nicosia will see higher short-term rental yields as tourism rebounds and more visitors arrive
In 2023 and 2024, tourism in Cyprus made a strong comeback, with visitor numbers almost back to what they were before the pandemic.
As more tourists flock to Cyprus, especially Nicosia, the demand for short-term rentals is on the rise. This surge in visitors has already led to higher occupancy rates in popular areas, and Nicosia is becoming a hot spot for tourists. Naturally, this increased demand is pushing up the average daily rates, which means property owners are seeing better returns.
The government is also playing a big role by promoting Nicosia as a sustainable tourism model. They're investing in tourism infrastructure, which is set to attract even more visitors. These efforts, along with glowing reviews on platforms like Airbnb and Booking.com, are making Nicosia even more appealing, further boosting the demand for short-term rentals.
With these positive changes, short-term rental yields are expected to increase as tourism continues to rebound. More visitors choosing Nicosia means more opportunities for property owners to benefit from this trend.
As Nicosia becomes a more attractive destination, the city's tourism landscape is evolving. This evolution is not just about numbers; it's about creating a sustainable and appealing environment for tourists, which in turn benefits property investors.
So, if you're considering buying property in the country, especially in Nicosia, now might be the perfect time to tap into this growing market.
Sources: Kathimerini Cyprus, Statista, Kathimerini Cyprus, CEIC Data
7) Nicosia’s property prices will rise moderately due to limited land availability
Nicosia is experiencing a property price surge due to limited land availability.
With more people moving to the city, the demand for housing in Nicosia is climbing. This growing interest isn't matched by the current supply, which is pushing property prices up. People are drawn to urban living, adding to the demand for city homes.
Looking back, property prices in Nicosia have consistently risen over the years. This trend is expected to persist, mainly because of the scarce land and high demand. Experts in real estate have noted that the need for housing will likely continue to exceed what's available.
In Nicosia, urbanization trends are a key factor in the rising property prices. As more individuals prefer city life, the competition for available properties intensifies, further driving up costs.
Real estate market analyses suggest that the gap between housing demand and supply will widen. This imbalance is a significant factor in the ongoing increase in property prices.
For potential buyers, understanding that limited land is a major driver of price increases is crucial. This scarcity means that properties in Nicosia are likely to remain a hot commodity.
Sources: Immobiliare.it, Cyprus Property Buyers, Global Property Guide
8) Affordable housing prices will rise as demand exceeds supply in the city
In 2025, affordable housing prices in Nicosia are set to rise as demand outstrips supply.
More people are flocking to the city, with 67% of Nicosia's population now living in urban areas. This urbanization is growing at a rate of 0.76% annually, which means more folks are looking for homes in the city. As the city buzzes with new residents, the need for affordable housing is becoming more urgent.
Finding land to build new homes in central Nicosia is tough. The limited land availability is a big hurdle, making it hard to keep up with the housing demand. Government reports point out that housing shortages are getting worse, partly because of the red tape involved in getting construction permits.
In 2023, real estate transactions in Cyprus jumped by 40% compared to the previous year. A lot of these sales were to foreign buyers, showing just how hot the market is. This rush to buy homes is pushing prices up even more.
Adding to the pressure, residential building permits fell by 7.1% in the first eight months of 2023. This drop means new housing isn't being built fast enough to meet the growing demand.
Sources: Country Reports, Grekodom
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) City center rents will increase as demand for urban living grows
In recent years, we've seen a noticeable shift in how people choose to live, with more individuals opting for urban environments. This trend is particularly evident in Nicosia, where a significant portion of Cyprus's population resides. As of 2023, 67% of the country's population lived in urban areas, highlighting a strong preference for city living.
One of the key indicators of this growing demand is the increase in rental prices. In 2023, apartment rents in Nicosia rose by 5.5% year-on-year, while house rents saw a 3.2% increase. This upward trend in rental costs suggests that more people are seeking homes in the city center, driving up demand and, consequently, prices.
Additionally, the influx of new businesses and amenities in the city center has made urban living even more attractive. Reports from 2023 indicated that commercial spaces were in high demand, with shops in shopping centers selling out quickly. This surge in commercial activity often correlates with higher residential rental prices, as more people are drawn to areas with vibrant business and social scenes.
Moreover, the trend of remote work has played a significant role in this shift. Nicosia's appeal as a digital nomad-friendly city has attracted professionals who prefer the convenience and lifestyle offered by urban living. This has further increased the demand for rental properties in the city center.
Sources: Global Property Guide, Country Reports, Invest Cyprus, Dom.com.cy
10) Central Nicosia will see increased demand for rentals due to a growing expatriate community
The growing expatriate community in Nicosia is boosting demand for rental properties.
More people are moving to Nicosia for work or study, with 208,843 foreign-born individuals in Cyprus as of December 2023. This number has been climbing steadily, making the city a vibrant hub for newcomers.
Multinational companies are setting up shop in Nicosia, which is evident from the 3.0 USD billion increase in foreign direct investment by June 2024. This means more professionals and their families are relocating here, naturally driving up the need for rental homes.
Expatriates often choose renting over buying because it offers flexibility, especially when their stay is temporary. This preference is a key factor in the rising demand for rental properties in central Nicosia.
Real estate market reports show that rental prices are climbing, a clear sign of the increased demand from expatriates. This trend is reshaping the housing landscape in the city.
With a growing expatriate community, Nicosia is becoming a hotspot for rental properties, attracting both investors and renters alike.
Sources: Trading Economics, CEIC Data, Supermove
11) Virtual reality tours will become more common, simplifying property viewings for international buyers
Make the following text more more fluid (it's important - you can reshuffle structure if necessary) and more conversational, with simple terms and 30% less yapping. The reader is someone who might buy a property in the country. Elaborate the data by giving specific context element and insider knowledge. If a statistic or specific data is absent, don't mention it. Your answer must absolutely start with "" and end with "
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Virtual reality tours have become increasingly popular in the real estate industry, especially for international buyers. In the past, specifically in 2023 and 2024, the global virtual tour market was valued at $0.96 billion and was projected to grow significantly, reaching $17.88 billion by 2035. This rapid growth, with a compound annual growth rate of 27.9%, highlights the increasing adoption of virtual reality technology in real estate globally.
Moreover, advancements in VR technology have made it more accessible and affordable. Leading companies have developed AI-powered 3D virtual tours, providing cost-effective and rapid solutions. This technological progress has allowed real estate agencies to offer more immersive and detailed property tours, making it easier for international buyers to view properties without the need for physical visits.
In Cyprus, for instance, the real estate market experienced a boom, with a notable increase in foreign buyers. In 2023, the number of foreign buyers rose by 16% year-on-year, with non-EU buyers accounting for a significant portion of the market. This trend underscores the growing demand for virtual property viewings, as international buyers seek convenient ways to explore properties from afar.
Sources: PhotoUp, Property Guides, GlobeNewswire
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12) New property tax rules will boost investment in energy-efficient homes
The Cypriot government is making it easier to invest in energy-efficient homes with new property tax regulations.
These changes include tax exemptions and increased capital deductions, which make energy-saving upgrades more appealing. For example, the capital deduction rate for energy efficiency improvements has jumped from 3% to 7%, offering a solid financial incentive for homeowners to make these upgrades.
There's also the Energy Saving and Modernization of Houses Program, which provides substantial subsidies for energy-efficient upgrades. Depending on your property and the energy savings you achieve, you could get sponsorships ranging from €7,775 to €32,000. This financial support helps cut down the initial costs, making energy-efficient homes a more attractive option.
Property sales in Cyprus are on the rise, especially among first-time buyers. In 2022, sales went up by 29.6%, and in 2023, they increased by another 19% in the first ten months. Homes with higher energy ratings, like A or B, are fetching better prices and have a stronger resale potential. Buyers are willing to pay more for homes that promise lower utility bills and a smaller carbon footprint.
Sources: Anisad Blog, Viotopo News, Estate of Cyprus
13) Co-living spaces will gain popularity as more people look for affordable housing options
Property prices in Nicosia have been climbing, making traditional housing less affordable.
Young professionals and students are flocking to Nicosia for jobs and education, which has boosted the demand for rentals. Co-living spaces are becoming popular because they offer a community vibe and meet both housing and lifestyle needs.
In response, new co-living projects are popping up in Nicosia. The government is even backing these initiatives with financial support to convert buildings into student housing, which aligns with the growing interest in co-living.
Surveys show that people prefer community-oriented living, which is fueling the rise of co-living spaces. Successful models from other cities are being copied in Nicosia, making cost-sharing and community living attractive to millennials and Gen Z.
These co-living spaces are not just about saving money; they offer a sense of community that many find appealing. Government programs are helping to transform old buildings into these modern living spaces, making it easier for people to find affordable housing.
As more people look for affordable options, the popularity of co-living spaces is expected to grow. This trend is particularly strong in urban areas where housing costs are high, and people are eager for alternatives.
Sources: Savills, Realty.com.cy, JLL, Kathimerini
14) Suburban property prices may dip slightly as urban living gains appeal
People are increasingly choosing to live in cities like Nicosia.
In 2023 and 2024, urban living became more popular due to the allure of city amenities and job opportunities. This trend is particularly evident in Nicosia, where the economy is thriving. With a projected GDP growth of 3% by 2025, Nicosia is becoming a magnet for young professionals seeking vibrant city life.
As the economy grows, so do job opportunities, especially in cities like Nicosia and Limassol. This has led to a surge in rental prices, reflecting the high demand for urban living. In 2023, rental prices in Cyprus rose by 18.57%, with Limassol seeing a significant increase of 25.3% in apartment rents. This indicates a strong preference for city living among young professionals.
Young professionals are flocking to urban areas for shorter commutes and proximity to workplaces. In 2023, Cyprus boasted a 78.9% employment rate, drawing many to its cities. The tech and finance sectors, in particular, are booming, offering abundant job opportunities in urban settings.
Urban infrastructure is also improving, making city life even more appealing. New developments and better public transport are enhancing the urban experience, further attracting people to city centers. This shift is reshaping the real estate landscape, with suburban areas seeing a slight decline in property prices as urban living becomes more desirable.
Sources: The Luxury Playbook, Funding Programmes Portal
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) Central Nicosia will see higher rental yields as young professionals flock to city living
The rental yields in central Nicosia are expected to increase as more young professionals seek city living. This trend is largely driven by the rising demand for rental properties, as young professionals flock to the city for job opportunities. The influx of these individuals is evident from the growing number of apartments being rented out, particularly in areas close to business hubs and educational institutions.
Additionally, the number of young professionals moving to Nicosia has been significant, spurred by the city's expanding business environment and economic growth. With Cyprus's GDP climbing from 2.4% in 2023 to 3% by 2025, more jobs are being created in urban areas, attracting skilled workers in sectors like finance, IT, and education. This has led to higher employment rates in these fields, further boosting rental demand.
Urbanization trends also show a preference for city living among young professionals. As property prices rise, many are opting to rent rather than buy, which is driving up rental yields. Surveys support this, indicating a strong preference for renting over buying, especially in urban areas where the cost of living is high. This preference is contributing to the increase in rental yields as more people choose short-term rentals.
Sources: Global Property Guide, Global Property Guide, Prospects
16) Luxury property yields will stay stable as high-net-worth individuals keep investing
The luxury property market in Nicosia has been experiencing a steady demand, driven by its growing reputation as a desirable location for affluent buyers. This trend has been evident over the past few years, with both local and international high-net-worth individuals showing increased interest in the area.
The rental yields for high-end real estate have remained stable or even increased, as indicated by the RICS Residential Property Price Index for 2024Q3. This stability in rental yields is a positive sign for investors, suggesting that luxury properties continue to be a sound investment.
Government incentives have also played a crucial role in attracting foreign investors to the Cypriot real estate market. With benefits like reduced real estate transfer fees and a lower VAT rate for first-time homebuyers, Cyprus has become an appealing destination for those looking to invest in luxury properties.
In 2023, Cyprus saw a significant increase in real estate transactions, with a notable portion of these being luxury properties. This boom in transactions highlights the strong appetite for high-end homes, further supported by the limited supply of new luxury properties compared to the demand.
Investor confidence in the Cypriot real estate market remains high, bolstered by the country's economic stability and growth. The favorable tax incentives and the ongoing interest from international buyers ensure that the luxury property market in Nicosia will continue to thrive.
Sources: Developers Cyprus, Connor Legal LLC, Nomad Capitalist
17) Luxury property rents will stay stable as the market balances
The luxury property rental market in Nicosia is expected to remain stable as it reaches equilibrium.
Nicosia's charm as a business hub and its appealing lifestyle have kept the demand for luxury rentals steady. This consistent demand is a strong sign that the market is stable. People are drawn to the city not just for work but also for its vibrant culture and history, making it a desirable place to live.
The real estate market in Cyprus is showing a healthy balance between supply and demand. In 2023, the total value of real estate sold hit €4.4 billion, which is a good indicator of stability. Reports from agencies like Cyprus Sotheby’s International Realty highlight the solid performance of high-end residential properties, suggesting that the luxury segment is well-balanced.
Rental prices in Nicosia have been pretty stable over the past few quarters. There was only a slight increase in Q1 2024, and then things leveled out in Q2. This consistency in rental prices shows that the market is balanced. The city's favorable tax system and reasonable cost of living help maintain stable income levels for potential renters, which supports these steady prices.
Economic factors play a big role here. Cyprus's tax benefits and cost of living make it an attractive place for both locals and expats. This economic stability helps keep the rental market steady, as people have the means to afford luxury properties without sudden price hikes.
Overall, the luxury rental market in Nicosia is in a good place. With a balanced supply and demand, and economic factors working in its favor, rental prices are likely to remain stable as the market finds its equilibrium.
Sources: Cyprus Sotheby’s International Realty, Cyprus Property Buyers
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.