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Cyprus construction sector decline continues

Latest figures from the Cyprus Statistical Service paint a very bleak picture of the construction sector which continues to decline as the Island’s financial and banking crisis deepens.

THE NUMBER of building permits issued in April 2012 stood at 500 compared with the 560 issued in April last year; a decrease of 10.7%, according to the latest figures released by the Cyprus Statistical Service.

Compared with April 2011 the total area of these building permits fell from 174,749 square metres to 106,275 square metres, a drop of 39.2% and their value fell from €157 million to €106 million, a drop of 32.5%.

During April, building permits were issued for:

  • Residential buildings – 347 permits
  • Non-residential buildings – 77 permits
  • Civil engineering projects – 38 permits
  • Division of plots of land – 37 permits
  • Road construction – 1 permit

During the first four months of 2012 a total of 2,496 building permits were issued, a decrease of 5.3% compared with the first four months of 2011. The total value of these permits fell 30.8% and their total area fell by 35.6%.

New home construction

In April, 347 permits were approved provided for the construction of 373 new homes comprising 251 single houses and 122 multiple housing units (such as apartments and other residential complexes).

This is a fall of 39.0% compared with April 2011 when building permits were issued for the construction of 1,196 new homes.

Cyprus new home construction April 2012

Source: Cyprus Statistical Service

During the first four months of 2012, the number of new homes for which permits have been issued has dropped 44.1% compared with the same period last year.

According to the Cyprus Statistical Service, building permits constitute a leading indicator of future activity in the construction sector.

Readers' comments

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  • Gavin Jones says:

    Peter Howard.

    Your kind words directed at Nigel Howarth are well deserved and I’m sure will be much appreciated by him. Heaven knows how much work he has put into operating this website and long may he continue to give his advice which I and others know have been a great comfort to many.

    As for your positivity at the end of your comment, I’m afraid I’ve had a lifetime’s association with the island and possibly more than most and I don’t buy it. Its in-built ‘artful ways’ have brought it to its knees both economically and morally. Too many of its developers, banks and lawyers are a disgrace and successive government have condoned their collective corrupt antics. The whole edifice needs dismantling and the arrival of the troika is a possible route to nirvana.

    As far as I’m concerned, the jury’s still out and will remain so until the whole sorry mess of the Cypriot property market is cleansed – root and wretched branch.

  • Peter Howard says:

    Eco Man has certainly started an interesting debate !! I think that I am a position to comment as I am an estate agent here in Cyprus and previously had a business in the USA building Eco friendly log, and log sided homes in the Blue Ridge mountains in the USA.

    I love log homes with a passion, but to consider building estates of Eco friendly homes here in Cyprus, must be a joke. I have always been convinced that there is a market for homes like this, here in Cyprus – but as individual homes and in the right location such as mountain villages, the Troodos or close to the Paphos Pine Forest. In many areas, particularly coastal, or tourist, you are unable to get planning permission for this type of property.

    His colleague says he has 50 property inquiries a month – do not get exited !!! This year we have received on average more than 130 a month – but unfortunately this funnels down to only a few sales.

    I would also like to point out to Eco Man that Nigel Howarth is not a half empty glass man – I do not always agree with his comments, but they are always unbiased and fair and he does a very useful service to the property industry. Please also note that the bulk of people on this forum are unhappy people who feel that they have been mislead or cheated in some way – as a rule happy buyers do not comment on a forum like this.

    Eco Man – I agree with you in one area, in that I think that the property market is improving and will continue to done over the coming 3 years, and standards of new building will have to improve. The EU bailout, if it happens, will be a very positive boost to the island – government spending will have to be brought under control, banks will be recapitalized and start lending to credit worthy clients, and the EU has already acknowledged that the Title Deed problem needs to be addressed and dealt with – all very positive.

  • @All – Will those wishing to post comments on any article please read the posting guidelines above – and in particular “that the email address you provide is accurate and verifiable”.

    If this causes anyone a problem, they can get in touch with me via the contact page.

  • Road Warrior says:

    Eco-Man,

    You could have the best product in the world but, it’s not Cypriot, I am guessing you are not Cypriot, that would not matter in most of the countries in the EU but it matters here, every obstacle will be put in your way and as for finding a “Real Lawyer” best of luck with that one !!

    I wish you well and lots of luck, you will need it !!!

  • Odd_Job_Bob says:

    Being a plant is fine. Also, not having to reveal one’s true non-super hero identity is fine as well (as it is an anonymous forum, after all). It’s the weight of one’s argument that should decide whether or not the subscriber is wallowing in the wallabrawonga.

    So let’s look at a few Eco-points:

    1) “There is so much going on that does not make any headlines just yet but you are in the main so entrenched (sic) in your opinions”.

    The mystery “We have a secret weapon that you don’t know about but it’ll change the course of the war” is an old line, often used by regimes on the brink of collapse. These regimes ALWAYS collapse and said secret weapon never emerges.

    2)”Bob Diamond was head of Barclays…need I say more in terms of the comparisons of blame….That behaviour happens everywhere and none more so than in UK parliament.”

    OK, let’s imagine that David Cameron personally guarantees the storage of potentially lethal cargo, against all advice, which then blows up killing 13 people and plunges the country even further into depression. He commissions an enquiry that finds him guilty, but stays in power, proving that corruption in the political elite is the same in Cyprus as the UK.

    No, no way. The man would be indicted on CRIMINAL charges. If anyone thinks otherwise, they’re all entitled to their opinion. I wonder what colour the sky is in the planet in which they live though…

    3) “Eco is just a (sic) another topic..that fits nicely within this discussion…”

    Yes it does. Even if you don’t know about the Concrete Lobby (it actually DOES exist, but you won’t know until you come up against it, as my mate did to his ultimate peril), with construction virtually grinding to a halt (no buyers), does Eco-man really believe that eco-friendly houses is the MAIN (or even a tiny part of the)reason why people aren’t buying and that they’ll now all come flooding back?

    4) The troika is now crawling all over the island, the government finally admitting it is facing bankruptcy. I see no evidence of an “upward curve” in property purchase.

    Of course your mate’s views, which if he is the chap in business with you to construct and sell new property may not be completely objective, may differ…

    I could go on with more points, but I think people can see where this is going.

    Irrespective as to Eco-man’s true alter ego (Peter Parker perhaps, or maybe Henry the Mild-Mannered Janitor?), his argument is out there for all to read. It is more than likely that independent readers of this forum and potential buyers will be in accord with Denton’s assessment of his argument. Without the “fancy” bit.

  • Gavin Jones says:

    Good People.

    I suspect that Eco-Man is a plant and not of the growing variety. He’s possibly having a bit of fun as his style resembles some who dip in and out of Cypriot based websites in order to stir things up and uphold Cypriot ‘honour’.

    On the other hand, he could well be bona fide when it comes to his gushing positivity and perhaps he has access to information to which we mere mortals are not privy.

    Assuming that Eco-Man reads my comment, revealing his actual persona would give credibility to his claims that everything in the Cypriot garden is as potentially rosy as he claims.

  • Denton Mackrell says:

    @Ego-Man. Fancy bullshit. Res ipsa loquitur.

  • Eco-Man says:

    Wow…me defensive..I think not, just giving my opinion which differs from the prickly Orokliniites.

    There is so much going on that does not make any headlines just yet but you are in the main so intrenched in your opinions…

    funny how it’s mainly a UK perspective aswell.

    I came in peace and am happy with passionate debate, but just because I swim against your tide does not make me misguided …just not prepared to lay down and let others ruin the Island still further.

    I just so happen to be at the time of my life when I could help a little and possibly change things…

    Bob Diamond was head of Barclays…need I say more in terms of the comparisons of blame you lay at doggy sections in Cyprus.That behaviour happens everywhere and none more so than in UK parliament.imho of course.

    Mary …what reference did I give Greece ???

    I hope we continue this debate and soon you receive some good news…but I think it will take some convincing that it is indeed good on this forum.

    Eco is just a another topic..that fits nicely within this discussion…

    regards Ego-man…

  • Denton Mackrell says:

    @Eco-Man. Is it Eco-Man or Ego-Man? I agree with Odd-Job – you are not in ‘listening mode’ and there is quite a strong element of defensiveness in your responses to others here giving you fair warning.

    I’ve spent my whole career evaluating businesses and I can say from experience that the odds are heavily stacked against you if, as Odd-Job says, you fail to observe the rules of due diligence and ensure they take precedence over enthusiasm.

    As for Oroklini, I live there and your sneer about a ‘concrete jungle’ is a matter of opinion. I don’t see it as any more or any less a concrete jungle than any of the other coastal locations like Paphos or Paralimini/Protaras. You are also not going to find a miracle breed of ‘eco buyers’ wherever you go in Cyprus. Oroklini is a red herring which does not advance your ‘sales case’ for eco homes.

  • Maxwell Hannah says:

    Dear ECO-MAN you must do what the rest of us have done and that is, Open your front Door and Then your Front Gate and go out into the big World Mainly This Beautiful Island Of Cyprus (I agree with you here) and meet real People who have had lots of problems most of them not self made but made from Dodgy Solicitors and Developers etc etc who scammed and duped us, yes there are people who did not have any Problems, but they are very few, and Nigel Howarth did not create any of this, so why are you putting Him in with the dodgy`s and scammers?

    Title Deeds will solve 95% of all these Troubles.

    Regards
    Maxwell

  • Mary says:

    Mr Eco Man,

    I must say you keep mentioning the right people the right property etc., is that not the problem in Cyprus, is it not what you know it’s who you know. We had this in the 70’s in the UK, and it is great if your uncle etc runs in the correct circle.

    Cyprus is to small for that, I love Cyprus and I feel sad that the Government is not looking for the future of Cyprus, it would not take a lot for Cyprus to show the whole of Europe that we can do it, but as you say 5 euros for a drink on the beach front, have you noticed that it is only government workers on the beach, no tourist.

    I hope things change, but we have already lost a lot of good people, not because they are not strong or fit but because they have been stabbed in the back by Cypriot Government workers, and by the way we are Cypriot not GREEK.

  • Eco-Man says:

    Dear All…my associates plans and thoughts are well considered.

    I respect each and everyone of you and really appreciate the banter and debate as well as serious comment.Even if I tend not to totally agree with some.

    I have commented here only recently to encourage debate…no more and no less.

    I really am, almost, fully aware of what has been pointed out here but will be foolish not to take care and thank you for your warnings.

    However…We have to start the process of change somewhere and if done correctly I believe there is much to look forward to in Cyprus.

    Fact is many holiday in Egypt and Turkey now instead of Cyprus…paying 20 euros for 4 fruit juices in Phinnikoudes does not really help…along with all the other poor quality, over priced offerings. But amongst it all there are some who really do care about the Island.

    Parador, MRI and alike have all gone and only the fittest have survived…things are very, very different from just 3 years ago.

    I will happy to report on further positive news in due course and will question the slightest abnormal negativity. Which despite what has been said, is rife on the platforms we respect most.

    Jim..it’s only opinion…enjoy your day…and pleased I grabbed your attention

  • Jim says:

    Eco-man. No, I am not related to Nigel Howarth, I have never met him. I have however, commented many times on the subject of property in Cyprus & its perils, on his informative property site.

    It sounds like you have never dealt with Cypriot authorities previously. If it suits their purpose (and I think it may), you will quickly find it somewhat difficult to make any meaningful progress with building homes that have very little input from Cypriot workers, or suppliers. The years will pass by & you will get fed up, or run out of money.

    In any case, will anyone be able to afford, or want the end product.

    Re Oroklini, I live there & find (like many others), it is convenient for both Larnaca town & the beach.

    Good luck with your log cabins, in a more select area of Cyprus.

  • Odd_Job_Bob says:

    Whoah Eco-man!

    If you wish to ignore the business fundamentals of Cyprus, fine.

    If you wish to dismiss all the experience of the property market of not only individuals who write into the forum but many completely independent sources as highlighted by Nigel, again, absolutely your call.

    However, it really is an exceptionally bad idea to ignore the advice of people who have been dealing in the VERY SPECIFICS of your proposal. You won’t find anything written down about the things you WILL encounter (re: ECO-construction), as if you did, you definitely wouldn’t do it. The way the system works is for you to be drawn in and, after your initial investment, you’ll continue to throw good money after bad in the hope of recouping. The two ways of finding out what’s really in store for you are either 1) Listen to the people who’ve gone before or 2) Do it yourself.

    The terrible thing with investors in Cyprus is that there will always be those who, no matter what they hear, WILL NOT BE TOLD. They will continue to say, “Everything is great, everything is going well” to their mates in the pub, whilst their business haemorrhages money to all the corruption until one day, in a year or two’s time, they suddenly shut up shop for good and move off the island a good deal poorer.

    Hope this doesn’t happen to you. The offer of speaking to my mate (who basically was eerily so YOU 3 – 4 years that I have to pinch myself!) is still open.

    Ouch, by the way (should have pinched myself less hard….).

  • Hector says:

    I am waiting for the tsunami of the fall out when the EU et al, money lenders uncover just how bad the Cyprus banks and government debts really are.

    I’m afraid all the positive thinking in the world wont spirit that away.

  • @Robert Briggs – properties come with a lifetime structural warrantee (unless people sign their rights away in their contracts).

  • Eco-Man says:

    Gavin…et al…You have all possibly lived in a cave with the writers of this wonderful platform.

    If you were as in the know as I and had a positive outlook on life and Cyprus…trust me …you would feel a lot happier.

    I am not for one minute that things are great or going to change in the next few weeks, but rest assured that if you deal in the right and proper circles and your contracts are sound and constructed by a Real Lawyer.Then you have nothing to fear.

    If you want to save money, buying from inferior developers and cutting legal corners then …well the horror stories exist in ALL countries not just Cyprus.

    10 People standing outside Whitehall with some banners does not create an epidemic…unless it’s encouraged on this type of forum….It’s sad for the people involved but please do not think that everyone in Cyprus has the same dissatisfaction.

    For every bad deal there are many, many more good ones …if you go to the right people.

  • Eco-Man says:

    Dear Jim

    Oroklini is a concrete jungle and not the place to build eco homes.

    Oroklini is and was never the place anyone I knew recommended to buy property.

    The Timber framed houses did not sell because they were PROBABLY wrong place, wrong time…Cyprus was not ready…now is the time !

    The versions that are constructed are PROBABLY not low cost and certainly not with U values of 0.16 -0.19.

    As I have not seen them i will not comment further.

    Eco-Homes can been seen as Green Wash…and only some properties meet the criteria I would look for.

    Logs from Finland, best in world….Architects and Technicians from Germany, designers from UK to suit the market.

    Note…only foundations and the Land it sits on will have Cyprus stamped on it !

    Jim…are you related to Mr Howarth ???? He is a rather half glass empty man too !

  • @Eco-Man – I do not make the news, I merely report it – and I don’t live in a cave!

    Take a look at Σε ελεύθερη πτώση οι κατασκευές (Construction in free-fall) and

    Properties trapped in crisis

    Both reported in the local media.

    I first bought property here 20 years ago and when I moved here permanently ten years ago I had my house built to my design and specification.

    I don’t have any problems, and I know many other people who also do not have problems. But you need to understand that many thousands of local and overseas buyers have been lied to and cheated by ‘crooks’ masquerading as property developers and lawyers.

    I refer you to the Purchasing Property section on the Foreign & Commonwealth’s website.

    If you take the time to read some of the other news items and articles you will see that questions have been raised in the House of Lords and the European Parliament – and there are presently several cases waiting to be heard in the ECHR.

  • Odd_Job_Bob says:

    Dear Eco-person,

    Being positive is GREAT, but being positive and realistic is way better!

    A close friend of mine did exactly the same as you propose, up until last year when he HAD to jack it all in.

    Pre-fab, eco-friendly, wooden-framed houses were built in Finland to individual spec and imported into Cyprus for construction in 4 – 6 weeks to the highest possible building standards.

    Problems encountered were, more than anything, HUGE blocking by the government including made up fines, permits, planning delays – everything the government could throw at them. My friend later found out that many House of Representative delegates have huge shares in concrete companies and would stand to lose small fortunes if an alternative mode of construction became popular. If you like (and I gain his permission), I can pass you on my mate’s contact details so you can compare notes.

    Irrespective of the financial situation of Cyprus (and the myriad of BAD consequences that it will entail), PLEASE do the most diligent research you can before you throw away oodles of money (as my mate did).

    One last thing: Cyprus is completely unlike any business environment you have ever encountered. Normal rules just simply don’t apply here. Many, many of us (including yours truly!) have learnt this at great financial cost.

  • Gavin Jones says:

    Eco-Man.

    Along with everyone else, I wish you well.

    HOWEVER, there are too many fundamental flaws such as hidden mortgages, corruption and other severe ‘nasties’ inherent in the Cyprus property market. I would therefore refer you to re-read many times over the comments by Jim, Richard and especially Robert and consider retiring to a cave with a good stock of books until and unless the mess is cleared up.

    I’m afraid it’s rather more of a case of Repo- rather than Eco-Man in Cyprus and it doesn’t look to be changing anytime soon.

  • John Swift says:

    Could it be that now the EU is involved the banks are now taking proper precautions regarding developers re-mortgaging fiddles.

    Maybe the EU should also start on the conveyancing Solicitors who have let their clients down.

  • Jim says:

    Eco-man. A company built a large number of timber framed, insulated eco friendly villas in Oroklini. They all look finished (unlike the usual skeletons).

    This was about three years ago. Very few sold. The estate is like a ghost town, with all the nice new houses empty.

    I wish you & your colleague luck with your proposed business venture, but I fear, unless you can supply a clean title deed, along with the keys to the property, you will fare no better. This is especially so, when the banks have no money to lend for a mortgage & people have no work to qualify for one anyway.

    I believe peoples financial position is about to get much worse. Severe government cutbacks & tax increases are about to be imposed by the EU, as a condition of any bailout. If indeed a successful bailout is possible.

  • Robert Briggs says:

    @ Mr Eco-Man, will these eco-homes come with full, immediate & genuine Title Deeds + 10 year structural guarantees, at point of sale? Please inform ASAP. R.B.

  • Eco-Man says:

    Thanks Martyn…Positive thinking is the ONLY answer. A colleague of mine informs me that he has had over 300 new enquiries to buy properties in Cyprus in just 6 months….He seems to think we are on the upward curve…not a boom…but things are starting to move.

    With the ECO-HOMES I think the face of Cyprus might start to smile very soon.

    Good luck

    Eco-Man

  • Richard Francis says:

    @eco-man – agree with Martyn – good to see some positivity. Be extremely interested to know more about that if you have a website up somewhere.

    It’s not just the building materials though that’s the issue on the island. There are many problems on the island way beyond actual construction.

    On top – people who have bought (and been conned) need compensating first to clear out the hideous messes of the greed-spree of the last 7-8 years in particular. Regulations then needs putting in place that are tightly enforced where needed.

    Long, long term I’m positive something will win through – but don’t expect to make a quick buck on the island – there have been too many people burned and too bad a reputation now pasted all over the internet for that.

    The island is beautiful though – and not everyone on it a crook – so there is eventual hope.

  • MARTYN says:

    Good to see input on this platform from someone with a few sparks of positivity, Hope even – even if at present there are but a few potential green shoots of change!

  • Eco-Man says:

    Change the way you think and things will change…and quickly.

    Change the way you build and it will be sped up even faster.

    Do what you always do and you will get what you always get !

    Look after the environment and reduce the carbon footprint and watch your fortunes begin to change

    Embrace what others have done in Europe for years and see the World take notice again of the best Island in the Med…BAR ABSOLUTELY NONE…CYPRUS

    With the almost 340 days of sun and no Solar ..until recently, with the highest cost of Electricity in Europe. It is no wonder buyers have looked elsewhere.

    With some the worst designs and build ideas, with unfinished holiday homes all over the island, with short or non-existent guarantees with the weaker, smaller developers running out of funds, with the lack of positivity from Howarth & co …and Banks with no liquidity and not lending…then it’s hardly surprising it’s all grinding to a halt. The negativity is way beyond the normal….and it’s spread like an epidemic across the Island….BUT not quite to ALL.

    NEW ECO-HOMES, NEW LUXURY ECO-LODGES AND NEW ECO-COTTAGES ARE COMING TO CYPRUS…LOW COST, LOW ENERGY HOMES THAT WILL SAVE ENERGY AND MONEY.

    There is more than a glimmer of hope and it’s coming to a plot of land near you.

    No more, too hot in summer, too cold in winter, ugly unfinished white concrete eyesores…but now well designed, traditional or modern homes,and eco-friendly are starting to arrive, with materials from Finland I hasten to add.

    Rightmove Overseas has some info on this in the Cyprus section…take a look for yourself …we did, and at last, something seems to be moving in the right direction for the construction industry in Cyprus.

    Jim…you may just be wrong !!!!!

  • Jim says:

    This comes as no surprise. There will be worse to come, with a combination of the title deeds fiasco & EU enforced severe economic cutbacks (despite the president’s claims to the contrary).

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