Demand for Secondary Housing Growing in Cyprus

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12 August 2021 Liza Medvetskaya

According to the observations of Cypriot real estate agents and local developers, residents of the island are actively investing a significant part of their savings in housing.

At the same time, the trend towards real estate investment for subsequent profit has recently intensified. Apartments and houses on the secondary market are especially popular.

First of all, people over 40 are interested in buying a home, as they have accumulated sufficient funds or they can get a mortgage.

Thus, according to Petros Lazarou, General Director of G&P Lazarou, "90% of the savings of Cypriots over 40 are invested in secondary housing." This is especially true of bank employees who prefer to own real estate rather than keeping their money in deposits, as well as civil servants who retire early and buy housing in order to have additional income. In addition, some retirees are willing to put their savings accumulated over the years, instead of keeping them "under the pillow."

We must not forget that there are market sectors that did not suffer from the crisis, but their profitability even increased. For example, this is the sphere of education, health care, food and services, - said Lazarou.

By the way, he also included the construction industry there, which, in his opinion, is still in limbo, nevertheless, it was in an advantageous position from 2013 until recently. Contractors who have been able to make good money on sales are re-investing in housing. He also stressed that clients buy real estate, which after the 2013 financial crisis was in bad position for a long time. Today these objects have disappeared from the market.

Finally, Lazarou said that buyers between the ages of 25 and 40, who are acquiring real estate for the first time for their own needs, prefer to buy new apartments or small houses, using mortgages and banking services, as well as using government subsidies on interest rates.

In turn, the representative of the React Estate agency Demetris Neophytou confirmed that the Cypriots do use their deposits and money that they have kept in banks or at home for years to buy a second home. Apartments in houses less than 20 years old are in great demand. As it turned out, such options attract Cypriots for their footage and high yield.

Neophytou also noted that people between the ages of 25 and 40 usually buy their own homes using loans. Interestingly, this category of buyers rarely buys real estate for investment.

WiRE FS CEO Pavlos Loizou expressed the opinion that Cypriots are buying real estate, mostly low-cost apartments, ranging from € 150,000 to € 180,000 in order to secure additional income, but also due to the lack of alternative investment opportunities.

On the other hand, he noted that the interest rate subsidy from the government has given impetus to the purchase of real estate by young people, mainly couples looking to buy their own home, or the average household with capital for a down payment.

According to the statements of the president of the property owners association, George Mouskides, Cypriots prefer to buy apartments on the secondary market in order to have additional rental income, instead of keeping their savings in banks and not being exposed to the risk of a new haircut on deposits.

Cypriots who have funds prefer to buy apartments without using loans, because the profitability of real estate is stable. But young couples are actively using the opportunity to lend, - said Mouskides.

The President of the Real Estate Owners Association also expressed the opinion that inflationary trends will prevail in the market, because various countries, in an effort to warm up and strengthen their economies in the midst of the pandemic, printed a lot of money. This will lead to inflation, which will reduce the value of cash. On the contrary, property values ​​will remain stable. Moreover, prices can rise by 5-6% per year.

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Have you decided to buy an apartment or a house in Cyprus? Contact the DOM Real Estate! The website has a large selection of real estate objects - residential and commercial. Experienced agency specialists will be happy to help you make the right choice.
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