The recovery in the Cyprus property market is being driven by foreign purchasers and is expected to gradually push up prices according to the Chairman of the Cyprus Real Estate Agents Association.
CYPRIOTS’ interest in the property market remains low, unlike foreigners who have been the driving force, leading the market to a significant rise during the past few months. Cyprus’ Real Estate Agents Association Chairman Marinos Kynegirou has told the Cyprus News Agency that, despite announcements from the banks for attractive loans, lending has been particularly complicated and difficult, and as a result Cypriots’ preferable solution is renting amid difficult economic conditions.
At the same time, Cypriots who have money appear to be hesitant to buy property due to the recent financial crisis. However he noted that there is a significant rise in the demand by foreigners, which as Kynegirou says, is expected to gradually push upwards real estate prices. Kynegirou believes that now is a good period for someone to invest in real estate, as the prices have stabilised and deposit rates offered by banks are almost nil. He pointed out that in order to boost the market, the banks must facilitate more the applicants.
“The banks used to lend everyone in the past, while now they give everybody a hard time for any kind of loan” he said. Foreigners who bring money from abroad and want to open an account with a Cypriot bank also face difficulties, he added. Kynegirou said that in this respect, the banks have gone from one extreme to the other but they have to become more accessible. He noted that it is much easier to transfer money from abroad to a foreign bank operating in Cyprus, rather than to a Cypriot bank.
The incentives provided by the Interior Ministry, mainly to attract foreign buyers, seem to have been the catalyst that pushed up the property sales, according to the Chairman of the Cyprus Real Estates Agents Association. “Foreigners buy, they have trusted the real estate market in Cyprus,” he said, adding that Russians, Chinese and Arabs are interested in buying real property in all the cities. Russians are mostly interested in buying in Limassol, whereas Arabs eye the city of Larnaca. Paphos attracts mostly Russians and Chinese. The interest for the capital Nicosia is much lower. Kynegirou said that sales of properties in August rose by 50% compared to the same month in 2015, while in the first eight months of 2016 there was an increase of 30% compared to the corresponding period last year. Sales to foreigners increased by 16.6% in the first eight months of 2016. He precluded the possibility of a new property bubble in the future, explaining that the events that have led property prices to soar before the crisis, such as Cyprus’ access to the EU, cannot be repeated.