THE THIRTY SECOND publication of the RICS Cyprus Property Price Index reports that the average price of residential apartments and houses across the island have risen by 17.4% and 4.2% respectively since the third quarter of 2017.
Over the same period of office prices have risen 8.8%, warehouse prices by 4.4% and retail prices by 4.5%.
Significant price rises were recorded in all districts and asset classes, with Paphos and Paralimni reporting slightly lower increases than the other districts.
The highest increase was reported in the southern coastal town of Limassol with 13.2% and 14.3% respectively, for offices the highest increase was in Nicosia with 19.5%, for warehouses and retail the highest increase was in Nicosia with 7% respectively.
Quarterly price changes
Compared with the 2nd quarter of 2017, prices of apartments and houses rose by 0.5% and 1.7% respectively. Limassol reported the largest quarterly increase with apartment and house prices up 4.1% and 5.5% respectively.
Prices of holiday homes over the quarter also rose with the prices of apartments rising by 2.5% and houses rising by 1.80%. Limassol reported the highest rise in holiday apartments with an increase of 4%, while Paralimni reported the highest quarterly rise for holiday homes at 2.9%
Across Cyprus, on a quarterly basis rental values increased by 4.6% for apartments, 2.5% for houses, 1.5% for retail premises, 5.7% for offices and 0.9% for warehouses.
Compared to Q3 2016, rents increased by 12.5% for apartments, 9.2% for houses, 6.1% for retail premises, 22.4% for offices and 1.6% for warehouses.
What does the future hold?
Some economists are warning that the recovery in the Cyprus property market is short lived and expect prices to fall in a couple of years.
Speaking to the Cyprus Mail Marios Mavrides who teaches economics at the European University of Cyprus said that the current increase in property prices, which fell after the peak of the property bubble nine years ago, is likely to come to a halt in two years.
“Prices have not fallen enough,” said Mavrides who is also a Disy MP.
Economist Marios Clerides said that that he too feared a possible drop in real estate prices.
“I am concerned about property prices because we have created artificial demand with the passport scheme and the sustainability in this area,” he said. “The real estate market in Cyprus is fragile”.