Foreign Buyers Opting for More Affordable Properties
Foreign investors in Cyprus are shifting their focus from luxury homes to more affordable housing, prioritizing residency permits over citizenship. According to a 2023 report by real estate firm Danos, this trend marks a notable shift in the market dynamics of the Cypriot property sector, with Foreign Buyers Opting for More Affordable Properties.
Shift from Luxury to Affordable Housing
The Cypriot real estate market has undergone a significant transformation, with demand for luxury properties waning in favor of cost-effective homes that offer residency benefits. This shift moves away from the high-end market previously driven by the now-defunct ‘golden passport’ scheme, officially terminated in November 2020.
Market Trends and Data
Danos International’s data suggests that this trend, first emerging in 2023, will persist into 2024. The luxury property segment, especially homes priced above €1.5 million, saw a steep decline in 2023. Although early 2024 showed a slight rebound, the market remains in recovery from last year’s downturn.
Decline in Luxury Property Sales
The luxury market contracted by 26% in 2023, with just 164 transactions amounting to €440 million—the lowest share since 2013. This decline began after record-breaking years in 2016 and 2017, when foreign investors, motivated by the Cyprus Investment Programme, drove high-end sales. The programme’s termination in 2020 led to a decrease in demand for luxury homes.
Stabilization and Future Outlook
Looking ahead, the Cypriot real estate market is expected to grow moderately despite ongoing challenges. Kyriakos Kiliaris, Chief Marketing Officer at Danos, believes that stabilizing interest rates will help balance demand. While luxury property sales are unlikely to reach 2017 levels, foreign buyers opting for more affordable properties will continue to support the broader market.
Geopolitical Influence and Investment Opportunities
Geopolitical tensions, especially in the Middle East, are expected to sustain interest from European and Asian buyers. The Cyprus Residency Programme, known as the ‘golden visa,’ remains a major driver of foreign investment, offering residency to non-European nationals investing in Cypriot real estate. Despite rising construction costs and regulatory changes, foreign buyers opting for more affordable properties show continued strong interest in the Cypriot property market.
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Source: Cyprus Property News
