AS WE reported earlier this month, the effects of the corona pandemic have frozen the island’s property market with sales during April falling by 80 percent compared to April 2019.
Further analyses of the April sales by the Department of Lands & Surveys reveals that both the local and overseas market sales have been affected:
Domestic property sales
Property sales to the domestic market (which accounted for 58% of all sales in the month) fell by 85% compared to April 2019 with sales falling in all districts.
Limassol recorded the biggest fall, down 92% compared to the same month last year. Sales in Famagusta fell 90%, sales in Larnaca fell 82%, while sales in Nicosia and Paphos fell 79% and 70% respectively.
Domestic Property Sale Contracts – 2019/2020 Comparison
Overseas property sales
Property sales to the overseas market fell by 71% compared to April 2019 with sales falling in all districts.
Hardest hit was Famagusta, where sales were down 89%, followed by Larnaca, where sales fell 84% and Nicosia, where sales were down 72%. Meanwhile, sales in Paphos and Limassol fell 67% and 64% respectively.
Total Overseas Property Sale Contracts – 2019/2020 Comparison
Sales to EU citizens
Sales to EU citizens fell 66% compared with April 2019 with sales falling in all districts.
There were no sales of property to EU nationals in Larnaca, Nicosia reported an 84% drop and Nicosia an 82% drop. Meanwhile, sales in Paphos and Limassol fell 50% and 43% respectively.
Foreign (EU) Property Sale Contracts – 2019/2020 Comparison
Sales to non-EU citizens
Sales to non-EU citizens fell 73% compared to April 2019 with sales falling in all districts.
Property sales in Famagusta fell 95%, while sales in Larnaca fell 78%. Meanwhile sales in Paphos, Limassol and Nicosia fell by 75%, 68% and 54% respectively.
Foreign (Non-EU) Property Sale Contracts – 2019/2020 Comparison
What of the future?
Writing in the Financial Mirror, the CEO of Danos & Associates Panos Danos said “The effects of the pandemic on Cyprus real estate are intensifying” noting that “Demand from abroad, which has led to a market recovery in recent years, primarily in Limassol and Paphos, is now almost non-existent.”
But on a positive note he wrote that “Buying a home, however, both in times of crisis and otherwise, is always a necessity. People will never stop buying or renting homes. In Cyprus, most developments are qualitative and if their price levels remain reasonable, they will soon be met by demand.
“Of course, everything will depend on the length as well as the depth of the crisis and the economic aftershocks it will leave on the property market.”
Speaking to the media yesterday, Central Bank Governor Constantinos Herodotou warned that the economy will experience a “serious recession” in 2020.
“The economy’s prospects for 2020 and afterwards are dramatically overshadowed by the negative developments of the coronavirus pandemic.”
In its annual report, the Central Bank said the pandemic “constitutes an extremely serious internal and external shock which is affecting demand.
“The financial impact cannot be quantified with precision for the time being…given that there is insufficient economic data for 2020, nor can the pandemic’s duration be projected.
“The question is not whether a recession will take place but how extensive it will be.”
Cyprus Property Sale Contracts 2000 – 2020
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1 The Department of Lands & Surveys has advised that overseas sales in 2018 and subsequent year should not be compared to sales in previous years due to changes in the methodology used to classify ‘Aliens’ (foreigners).