DELFI Partners & Company’s report ‘Cyprus Real Estate Market Expectations & Forecasts’ concludes that the island’s economy will bounce back from the recession in the next five years, and that how the banking sector deals with NPL’s distressed assets and the potential need for recapitalisation is pivotal to a smooth recovery.
As well as providing an overview of the current state of real estate sector, the report provides forecasts for the main asset classes – office, retail and residential.
It considers that the island’s banking sector has the potential to make or break the recovery and that there is great potential for transactions well below the market value and extremely attractive short term returns. However much depends on whether the banking sector concerns regarding the level of NPLs and foreclosures have any harmful effects on the real estate market.
Delfi predicts that in isolated cases, “where the demand for residential property is low and distressed assets result in excess supply, further discounts of up to 40% of market value are not unlikely”.
Cyprus Real Estate Market Expectations & Forecasts – January 2016