The Cypriot government has announced plans to build 500 social housing units in Nicosia, Limassol, Larnaca and Paphos, with €70 million allocated for this large-scale project. An additional €7 million has been earmarked for the cost of the land for development. As part of this initiative, the properties will be rented out at affordable prices. Young families will be given priority when housing is allocated. The developer will be selected following a tender process. The project will be managed by the state in collaboration with the Cyprus Land Development Organisation (KOAG).
Why is this important for Cyprus?
Cyprus has been facing an acute shortage of affordable housing in recent years. Demand is growing, but supply is low, particularly in urban areas. The construction of new homes should ease the pressure on the market and provide more opportunities for people to rent and buy. The government considers such projects to be an important investment in society. Incidentally, the launch of this project was made possible by a stable economy and responsible budget management.
Cyprus President Nicos Christodoulides emphasised that this initiative forms part of a broader national strategy to provide affordable housing. To date, the state has invested over €300 million in seven existing programmes. The strategy aims to significantly increase the supply of affordable real estate, improve housing conditions for vulnerable groups, and balance the rental and real estate markets.
Expected results and launch dates
The Minister of the Interior, Konstantinos Ioannou, noted that the order for the implementation of the project will be published in the coming days. Construction of the first 181 properties in Nicosia and Limassol is expected to begin in 2025. A further 258 units are planned for construction in 2026.
According to current estimates, 1,967 new residential units and 258 affordable properties will be created in the country over the next two years, with €11 million being allocated to the Affordable Housing Fund. The project will help to bring unused buildings back onto the market, reducing pressure on prices and providing more opportunities for tenants and buyers.
Support will be provided to regions and socially vulnerable groups
The government continues to invest in the development of rural, border and mountain communities. Subsidies of between €20,000 and €95,000 are available for the purchase of housing in these areas. Between 2019 and 2025, almost 2,000 applications have been approved.
At the same time, social support services are providing displaced persons and affected families with grants of €20,000–40,000. Between 2024 and September 2025, a further 3,677 applications were approved.
A key element of the reform was to simplify and accelerate the process for issuing building permits. Applications for houses are now processed within 40 working days and those for apartment buildings within 80. This enables properties to be brought to market more quickly.