Cyprus’s construction sector started 2026 with record-breaking figures. According to the Statistical Service, the volume of building permits issued in January rose sharply across nearly all categories, from residential developments to infrastructure projects.
The total floor area of projects granted building permits in January 2026 reached 346.7 thousand m². This is 82.5% higher than in January of last year. Experts attribute this growth to strong demand for housing, continued interest from foreign investors, and the ongoing development of large-scale residential projects across the island.
The residential sector is expanding particularly rapidly. The floor area of new residential buildings surged by 112.3%, reaching 302 thousand m² compared with 142.3 thousand m² a year earlier. At the same time, the commercial real estate segment declined by 37%, indicating that developers are increasingly shifting their focus toward housing.
Paphos and Larnaca Lead the Growth
The most impressive increase was recorded in Paphos. Over the course of a year, the volume of licensed construction there rose by 665.7%, from 6 thousand m² to 45.6 thousand m². Compared with 2019, the increase reached 209.4%.
Experts note that Paphos remains one of the most sought-after regions among foreign property buyers, particularly citizens of the United Kingdom, Israel, and EU countries. New residential complexes, villas, and seaside developments are further boosting interest in the area.
Larnaca is also experiencing a true construction boom. The total floor area of licensed projects increased by 352.1%, reaching 87.6 thousand m². Compared with 2019, growth stands at 436.8%. The market is being driven by the large-scale redevelopment of the former port area, new residential districts, and infrastructure upgrades.
Nicosia maintains its leading position in terms of total construction volume. In January, 114.8 thousand m² of new projects were licensed in the capital, representing a 59.1% increase year-on-year. Compared with 2019, the increase reached 217.5%.
In Limassol, figures remain stable, although growth is slower than in other regions. Construction volume increased by 7.3%, reaching 94 thousand m². Despite more moderate growth, Limassol remains the most expensive property market in Cyprus.
The only region to record a decline was the free areas of Famagusta. The volume of licensed projects fell by 4.3%, to 4.6 thousand m². Even so, this figure is still 90.1% higher than in 2019.
Project Value Exceeded €445 Million
The total value of new construction projects also increased sharply. In January 2026, it reached €445.2 million, which is 92.9% higher than a year earlier. The strongest growth once again came from the residential property sector. The value of licensed residential projects rose by 113.9%, reaching €336.6 million compared with €157.3 million a year ago.
Infrastructure projects also grew significantly. The value of civil engineering works increased by 301.5%, totaling €50.3 million. Investment in road infrastructure, new utilities, and urban development continues to accelerate.
Analysts note that the construction sector is becoming one of the main drivers of the Cypriot economy amid strong housing demand and a limited supply of high-quality real estate.
The Number of New Homes More Than Doubled
The surge is especially visible in residential construction. Based on permits issued in January, 1,755 new housing units are planned across the island. This is 109.4% more than in January 2025, when 838 units were planned.
The main growth came from apartment developments. The number of apartments in multi-storey residential buildings increased by 135.9%, reaching 1,248 units. Mixed-use residential complexes also posted growth of 137.5%. The number of detached houses nearly doubled to 329 units, up 99.4% compared with the previous year.
Experts believe this trend reflects the continuing housing shortage in Cyprus, especially in the island’s most popular cities. Additional pressure on the market comes from foreign investors, the relocation of international companies, and ongoing population growth.