The Cyprus Property Market in 2010

What’s in store for the Cyprus Property market in 2010? Of course, no-one can predict that in the current economic downturn but property professionals across Cyprus, even those with long experience of the market, are preparing for a tough year ahead, in common with the UK and their other European neighbours. So, here are some facts to help give you a little insight into what’s happening in the Cyprus property market as we move into a new decade.

As most people expected, the Cyprus Central Bank, in its six-monthly bulletin, reported that prices had decreased by 8% during 2009, although they predicted that they will remain stable throughout 2010. A spokesman for the Central Bank said that the “drop in housing property prices coincides with the weakening of construction activity in 2009.” Estate agents and developers feel that prices have gone as low as they can and they are eagerly awaiting a new official House Price Index. Normally produced by financial services group, MAP S.Platis, the BuySell House Price Index is about to be replaced with an independent guide, which will probably be produced by the Cyprus Statistical Service (CYSTAT) from Land Registry Figures, although this is still to be decided. The Royal Institution of Chartered Surveyors (RICS) in Cyprus, will also produce a House Price Index from the end of January so keep checking our website for the latest details.

The most recent Land Registry figures, published at the beginning of the New Year, tell us that the total sales for 2009 amounted to just over 8,000, compared with around 14,500 in 2008. Most agents agree that the market has been severely affected by a sharp drop in demand from foreign buyers, particularly those from the UK and Russia. As prospective buyers tighten their belts and hang on to their hard-earned cash, the Cyprus property market is definitely feeling the pinch.

Traditionally around 70% of foreign buyers in Cyprus have been from the UK, but with sterling staying weak against the euro, those with UK property are less willing - or able - to release equity to buy property abroad. The latest Land Registry figures highlight this, showing that the worst affected areas in Cyprus are those formerly popular with foreign buyers. Larnaca, Paphos and Famagusta are all showing a drop in sales of around 50%, while Nicosia and Limassol, traditionally more popular with Cypriots and those doing business in Cyprus, suffered less with drops of around 30%.

So what about some good news? Some agents are reporting that although the period from September 2008 to March 2009 saw an unprecedented drop in first-time enquiries, from March last year, those who had delayed visits to look at property were starting to visit again, although in far smaller numbers than before the downturn. It seems that those who are keen to buy in Cyprus are sticking with it during the tough times.

Prospective buyers may be interested to know that, despite the economic recession, the Cypriot government is still investing in infrastructure, particularly in the Limassol area which will get a complete facelift starting this year. It will be one of the prime areas to benefit from major infrastructure developments in 2010 and could prove to be a good investment location whether it’s a purely financially-driven investment or a personal investment for you and your family. Limassol’s mayor announced at the end of December that four main projects, costing just over €50 million, will take place over the next three years, including the massive marina project which will be constructed at the heart of the old Limassol seafront. In addition, the town centre will be renovated and there will be a range of new sports and cultural facilities.
So, what if you’re thinking of buying a property in Cyprus in 2010? Is it a good time to buy? That of course depends on your circumstances, your lifestyle and what you want from your property in Cyprus. Buyers are naturally benefitting from the downturn as sellers offer significant reductions, particularly to cash buyers. If you’re one of the lucky ones who do have the funds and have made the decision to buy on this beautiful island, then the possibilities are endless. Beautiful traditional Cypriot houses, near Limassol, for around €200,000, a detached bungalow near Larnaca for €225,000 and apartments for under €100,000! Why not contact us and see what we’ve got to offer – times may be tough, but we are all still positive about the future of Cyprus and its property market in 2010. We’re ready and waiting to answer any questions you may have on info@cypruspropertyworld.com or take a look at our website on www.cypruspropertyworld.com

Happy New Year to you all!