The increase in house prices accelerated in the second quarter of 2022, mainly due to the increased construction costs, reports the Cyprus Central Bank in its quarterly House Price Index (HPI) report.
The bank’s HPI recorded increase in apartment and house prices of 1.7% compared to 1.1% in the previous quarter, while on an annual basis the index increased by 4.7% compared to 3.2% in the previous quarter.
Although increases in apartment prices exceed those of houses in all districts on an annual basis, house prices are now also increasing.
For the first time since the outbreak of the pandemic, all districts are showing year-on-year increases in both apartment and house prices, indicative of the upward trend in prices across the spectrum of the housing market.
Demand in the real estate market during the second quarter of 2022 recorded an upward trend (both domestically and from abroad), while there were signs of a downward trend in supply. The war in Ukraine has intensified inflationary pressures, with a significant impact on construction costs, but currently does not appear to have adversely affected demand.
In the medium term, the increase in the cost of borrowing, due to the rise in interest rates, as well as the erosion of incomes due to inflationary pressures, are expected to reduce demand, but without necessarily reducing prices, which are currently due to rising construction costs.
With the temperal increase in the cost of house building equipment which have result to a relatively increase in the percentage price of rooms and apartment is a big blow to the Cyprus economy why we cry out together for this unforseen circomstance,we pray that the consumer not end up been the sole one to pay the price .We know that the government can put in place other measure to put to an end of inflation for it is bad to every economy development and growth.thanks