PwC Cyprus ‘Cyprus Real Estate Market – Year in Review 2020’ provides insights into the behaviour of the Cyprus economy in general and presents key real estate market developments, focusing on the performance of the sector during 2020.
PwC reports that the Real Estate and Construction sector continues to be one of the key pillars of the Cyprus economy and it contributed 17% to the Cyprus Gross Value Added (GVA) in 2020.
Despite the disruption caused by the pandemic and the abrupt termination of the Citizenship-by-Investment scheme (aka Golden Passport) at the start of November, the sector’s GVA output dropped marginally (1%) during 2020, highlighting the resilience of the sector and its importance to the overall Cypriot economy.
There were 14,000 property transactions in 2020, compared to 17,200 in 2019; a fall of 19%. The value of property transactions fell by 32% to €3.0 billion compared to €4.4 billion in 2019. (These figures do not include debt for asset swaps and transactions through the sale of company shares.)
All districts suffered from double-digit falls in the value of properties transacted during 2020. Hardest hit were Limassol and Paphos, the districts most popular with overseas buyers, where values fell by 36% and 47% respectively compared to 2019.
High-end residential real estate segment
Based on the PwC’s analysis, the number of high-end property sales (i.e. those costing €1.5 million or more) stood at 176; a fall of 45% compared to 2019 when 318 were sold.
High-end sales totalled €400 million; a fall of 40% compared to 2019 when their sales totalled €720 million.
PwC notes that the high-end residential property segment of the market has been directed to ‘Golden Passport’ buyers. The termination of the scheme creates uncertainty for the segment, increasing the need to re-focus and transform developments which were intended for this segment of the market.