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Cyprus property prices rising

House prices in Cyprus rose during the second quarter of 2015 according to figures published earlier today by Eurostat, the statistical office of the European Union, contradicting both recent reports by the Cyprus Central Bank and RICS (Cyprus).

price-index-methodIN SHARP contrast with the Cyprus Central Bank’s Residential Property Price Index for Q2 2015 and the RICS (Cyprus) Property Price Index for the same period (both of which reported price falls), Eurostat reports that home prices in Cyprus rose during the second quarter of 2015.

According to Eurostat, house prices in Cyprus rose 7.4 per cent over the second quarter of 2015 after falling 2.8 per cent during the first quarter of the year – and rose 2.4 per cent compared with the second quarter of 2014.

These Eurostat figures are at odds with the Cyprus Central Bank, which reported house prices and apartment prices falling by 0.8 per cent and 1.5 percent respectively over the second quarter – and by 4.6 percent and 6.2 percent respectively compared with the second quarter of 2014.

The RICS (Cyprus) Property Price Index for the second quarter of 2015 reported quarterly falls of 0.3 per cent in house prices and 0.4 percent in houses.

According to Eurostat, the highest quarterly increases in house prices were recorded in Cyprus (+7.4%), Austria (+6.4%), Denmark and Spain (+4.1% each), while the highest falls were observed in Romania (-1.1%), Malta (-0.3%) and Italy (-0.1%).

In the same reports, Eurostat reports that the highest annual increases in house prices in the second quarter of 2015 were recorded in Sweden (+13.0%), Hungary (+11.9%), Ireland (+10.7%) and Estonia (+10.5%), and the highest falls were observed in Latvia (-4.4%), Italy (-3.0%) and France (-2.2%).

It is known that Eurostat, the Cyprus Central Bank and RICS (Cyprus) employ different methodologies to calculate their indexes, but it is difficult to understand the wide variation.

Speaking to the Cyprus Mail, property valuator Pericles Markaris said that the difference in the findings may be related to a difference in the methodology and inclusion of transactions of homes “at prime locations” involving non-Cypriots. However, as non-Cyprus accounted for just 30.8 percent of sales in the second quarter it is hard to understand how such a small percentage could result in such a dramatic variation in the figures.

Further reading

Eurostat newsrelease 174/2015 – 8 October 2015

Readers' comments

Comments on this article are no longer being accepted.

  • Barry says:

    It’s the same old manipulation of figures as normal.

    It was bad 8 years ago, it’s bad now, nothing has really improved, except the banks are getting closer to realising “Book values” could be improving for them to make their vulture like approach to repossess!

  • Kate says:

    Aren’t properties going to be revalued each year for IPT purposes? We’re still waiting for the 2016 rates to be applied so perhaps an increase in values will increase taxes?

    Building your own house.
    Following a conversation at my IPT office today, I would like to ask; when does IPT become payable, when the first brick is laid, when there is half a house, when the final certificate is received, when you move in or when you receive your updated TD which includes the house?

    (Editor’s comment: I expect that the revised values and IPT tax bands next year will make little difference to the amount we have to pay.

    IPT becomes payable when you get the Title Deed, regardless of whether anything has been built on the land.)

  • bill says:

    I would rather believe BoC…

    In case of foreclosure, it’s the interest of the banks to maintain the real estate markets at its highest value.

    So, if BoC says that prices are falling at a certain rate (according to statistics no one except the bank can check), one can be certain that prices are falling even faster…:)

  • Helen says:

    I’m missing something. What is it that’s obvious? Help me out here please!

  • Tony Hales says:

    Is there not an expert we can ask? Yes, I know one. Nigel. You are on the front line, which set do you feel are the closest?

    (Editor’s comment: I’d go with RICS (Cyprus) and the Central Bank.)

  • Deanna says:

    @Mike: Well said!

  • Richard says:

    I’d go with non-Cypriot third party data. By default it’s likely to be far more trustworthy.

    And – in this case – it’s some good news. About time really.

  • Mike says:

    Was it not Winston Churchill who stated “there are lies, damn lies and statistics”. Why do we need overpaid bureaucrats to tell us what is plainly and clearly obvious to us all and to make matters worse they tell us what we already know 6 months after we mere plebs work it out.

  • The views expressed in readers' comments are not necessarily shared by the Cyprus Property News.

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