Currently, there are eight major public construction projects underway in Cyprus, valued at over €250 million. The most ambitious projects are the construction of the new Cyprus Museum in Nicosia and the Limnes Accommodation Center in Larnaca. These projects are expected to reshape the island's architectural landscape and have a long-term impact on the real estate market, property values, and mortgage demand.
The new Cyprus Museum is the main cultural megaproject in Cyprus
The new Cyprus Museum is the largest cultural project in the country's history. Construction began in January 2023 and is expected to be completed in the second half of 2027. The 30,000-square-meter building will be located opposite the Parliament and will house a rich archaeological collection. This project is expected to attract international interest and impact the development of Nicosia's city center and housing prices in surrounding areas.
The Limnes Center and European funding
The second most expensive project is the Limnes Refugee Accommodation Center in the Larnaca area. Construction began in August 2023, with a scheduled completion date in the first quarter of 2026. The EU is funding up to 90% of the cost, which minimizes the burden on the Cypriot budget. According to the authorities, the center will comply with European safety and infrastructure standards.
Other projects and regional development
Additionally, new administrative buildings are under construction in the capital city of Cyprus, government agencies and offices are being modernized, and a press center for Cyprus's EU Council presidency is being established. In the Famagusta district, a new fire station is being built in the tourist resort of Ayia Napa, an important addition to the region's safety infrastructure.
These facilities are significantly changing Cyprus's infrastructure. According to experts, completion of these projects will increase housing prices in surrounding areas and boost investor interest in mortgage programs, particularly in secondary and resort real estate.
Impact on the Mortgage and Real Estate Market
Large-scale construction projects have a complex impact on the housing market. On the one hand, new projects create additional jobs and stimulate household income, supporting demand for mortgage loans. On the other hand, active infrastructure development leads to increased land and property prices in cities and resort areas.
According to the Central Bank of Cyprus, in June 2025, mortgage rates remained at around 3.9–4% for loans with a fixed term of up to one year, which is higher than the Eurozone average. Despite the slight increase in the cost of borrowing, demand for mortgages remains strong, especially in areas with promising infrastructure development.
Outlook for the future:
The years 2025–2027 will be crucial for Cyprus's transformation. As a number of large-scale projects are completed, the housing market will face new challenges. Property prices in Nicosia and Larnaca are expected to rise, and investor interest in properties in Famagusta's free areas is likely to increase. For buyers, it is more advantageous to consider mortgage programs while housing prices are growing at a moderate pace.