RESIDENTIAL - 8.5% INCREASE IN PRICES AND WORSE TO COME - HALF OF THOSE WHO BUY ARE FOREIGNERS - Filenews 25/9 by Angelos Angelodimou
Market professionals expect new increases in property prices in Cyprus for the next three months, according to what is recorded in the House Price Index, which was published yesterday by the Central Bank.
Already, an increase in the index of 8.5% on an annual basis is recorded in the second quarter of 2026, compared to the corresponding period of 2025.
In addition, three more important points are included in the report of the Central Bank:
(a) The house index recorded an accelerated increase, while the apartment index recorded a slowdown in its growth rate. Something that is not often the case, given that the apartments are in most cases in prime demand.
(b) Foreign buyers are now the majority in the province of Paphos, in Larnaca their percentage is close to 50%, while in Famagusta the balance is also balanced.
(c) Several parameters related to the real estate market are expected to move upwards in the next period. Among them, the demand for mortgages is expected to move upwards. As well as the cost of construction materials, as well as the supply of new housing units, will continue to move upwards.
The market is on the rise
The general house price index (houses and apartments) in the second quarter of 2026 recorded a quarterly increase of 2.4% compared to an increase of 2.3% in the first quarter of 2026. This was due to an accelerated quarterly increase of 2.5% in house prices and a slowing increase of 1.3% in apartment prices.
On an annual basis, an 8.5% increase in house prices was recorded in the second quarter of 2026, compared to an increase of 7.5% in the first quarter of 2026. By province, acceleration was recorded everywhere except in Limassol where a slowdown was recorded.
In particular, accelerated growth was recorded in Nicosia (5.7%), Larnaca (9.8%), Paphos (9.6%) and Famagusta (10.0%), while in Limassol a slowed increase was recorded (7.8%).
Foreign buyers
Sales documents, which concern all types of properties, recorded an annual increase of 15.4% in the second quarter of 2026 (5,298 compared to 4,592 in the second quarter of 2025).
The increase in sales documents came mainly from foreign buyers and to a lesser extent from domestic buyers.
Specifically, during the quarter under review, the number of properties sold to foreign buyers increased by 22.7% year-on-year (2,107 compared to 1,717 in the second quarter of 2025), while there was an 11% year-on-year increase in the number of properties sold to domestic buyers (3,191 compared to 2,875 in the second quarter of 2025).
By district, the most transactions are located in Limassol (1,765), followed by Larnaca (1,169), Nicosia (1,076), Paphos (1,073), while Famagusta (215) records the lowest number. The percentage of domestic buyers is 84% in Nicosia district, 66% in Limassol district and 57% in Larnaca district. In the province of Famagusta, the ratio of domestic and foreign buyers was generally balanced, while in Paphos foreign buyers predominate (66%).
Expectations
The expectations index from the European Commission's Economic Surveys (EPS) (June 2026) for sales prices over the next three months (which shows the trend recorded in house prices compared to the quarter under review), was at much higher levels in the second quarter of 2026 than in the corresponding quarter of last year.
This suggests that a larger proportion of participants expect increases in property prices in Cyprus in the next three months.
