The coronavirus pandemic and the cancellation of the Citizenship by Investment program have created a host of problems for the Cyprus property sector.
However, the latest sales figures show that all is not lost. The Cyprus property market can recover quickly if developers pay attention to the housing needs of a wider category of citizens. There is no doubt that it is domestic demand that will continue to drive the industry, as it did last year.
Moreover, according to research by LionGlobal, in the coming years, millennials will become the dominant force in the Cyprus property market.
As you may know, Generation Y is people born from the early 1980s to the mid-1990s. Unlike their parents, this generation tends to lease rather than buy a home.
But not in Cyprus. A LionGlobal study found that Cypriot millennials think differently. Many of them dream of buying a large and spacious house with a garden. In particular, when asked about the ideal type of housing, 55% of survey participants answered that they prefer a house, while a very large part of this percentage indicated that the minimum area of internal space in which they would like to live is 166 m2. 50% of respondents also indicated that having a rooftop garden or lounge area could be a deciding factor in purchasing a home. At the same time, among the survey participants who gave preference to apartments, the priority was 2-bedroom apartments.
As for the ideal location for buying real estate, the main need when choosing was for 76% of the survey participants the availability of developed infrastructure and the proximity of housing to work.
It is noteworthy that 34% of survey participants said that they prefer to rent housing in Cyprus, since this option is less expensive than buying real estate in the country.
At the same time, 67% of respondents said that buying a house on the island is best at the initial stage of construction, since you can get an excellent discount from the developer, as well as make the interior decoration to your taste.
According to the study, millennials are willing to buy houses in Cyprus, but at much lower prices than those currently on the market. Millennials are particularly interested in areas near the center of Nicosia and Limassol.
In particular, they are tempted to buy a house if it sells for about €270,000. Accordingly, they are ready to spend up to €125 thousand for the purchase of a one-bedroom apartment, €180 thousand for a two-bedroom apartment, and up to €225 thousand for a three-bedroom apartment.
According to a LionGlobal poll, 77% of millennials involved in the home buying process have a down payment of up to €45,000. At the same time, a significant part of them does not seem to be aware of either the lending terms offered by banks or the government's interest rate subsidy scheme. At the same time, 59% of participants who want to buy a house consider the high cost of real estate as a serious obstacle to buying a home.
However, 75% of respondents said that in the current circumstances, the decision to buy a home is a good investment.
LionGlobal CEO Nicholas Gabriel noted that Millennials have a desire to buy a home, but many of them face financial difficulties. In this context, the adoption of a comprehensive support plan for those looking to buy their first property is more urgent than ever. As in other countries, it is necessary to invent a model in Cyprus that will allow a new generation of buyers to receive support from the government. Thus, on the one hand, many millennials will fulfill their dream of purchasing a private home, and on the other hand, the real estate sector will receive a new round of development.