Larnaca, Paphos or Nicosia: which city to choose for property investment?

Cyprus has long attracted foreign property buyers due to its mild climate, stable economy and favourable conditions for buying a home.Until recently, only Limassol was popular with Russian investors, but in recent years the options have expanded. Larnaca, Paphos and Nicosia have also begun to attract the attention of those looking to invest their money profitably in Cypriot property.

Each of these cities has its own characteristics, advantages and disadvantages for property investment.It is worth making a wise choice to avoid disappointment.It is also wise to consult with experts in the field - for example, the team at DOM Real Estate Agency is always ready to help those thinking about buying property in Cyprus.

1. investing in Cyprus: features and benefits

Cyprus offers favourable conditions for investors, a favourable tax regime, a simplified business registration process and a stable economy. The main forms of investment include the purchase of residential and commercial property, as well as the purchase of valuable assets and investments in funds.

Real estate remains the main area of investment.Residential property is purchased for both owner-occupation and rental, providing a stable income.Commercial property, including office buildings, hotels and retail space, is in high demand from international companies and local entrepreneurs. Average rental yields range from 4% to 7% per annum, depending on the type of property and location.

Cyprus also attracts investors due to its low taxes.Tax incentives for home purchases, relatively low corporate tax rates (12.5%) and favourable conditions for international business make it one of the most attractive European destinations for capital.Due to its strategic location between Europe, Asia and the Middle East, Cyprus is a convenient point for international trade and financial transactions.A well-developed infrastructure, modern banks and a high level of security make the country a reliable place for long-term investment.

It is worth mentioning that there is a special programme for investors who purchase real estate for the amount of 300,000 euros or more.The Accelerated Programme of Residence through Investment allows you to obtain the status of resident in an average of 6 months:

1. The main requirement is the purchase of one or more properties for a total of 300,000 euros or more;
2. It is necessary to pay at least 200 thousand euros at once, the rest can be paid in instalments or mortgages;
3. the transaction must be made through a developer and only for the main property;
4. mandatory condition - not to work officially in Cyprus and to receive a stable income from abroad (not less than 50 thousand euros per year for the main applicant);
5. the investor must prove the legality of the funds used to purchase the property and provide certificates of good conduct;
6. the investor's family members may participate in the scheme: spouse and children, and their foreign income must also be declared;
7. the investor and his family members do not have to pass tests on knowledge of the language, history of Cyprus and permanent residence on the island - it is enough to spend 3 days here during the two-year period;
8. The residence permit is automatically renewed if the conditions of residence are fulfilled (see above).

Finally, a Cypriot permanent residence permit allows you to apply for citizenship after 7 years of permanent residence on the island. A Cypriot passport offers many advantages and its holder becomes a citizen of the European Union with the corresponding rights and privileges.

Popular areas of investment, apart from the real estate sector:

1. Hotel and tourism investments;
2. International business registration and opening of companies;
3. Development of start-ups and IT projects;
4. Investment in the 'green' sector, which is growing in popularity.

Below we look at each of the three Cypriot cities, highlighting their characteristics and advantages for foreign investors.

2. Larnaca: growing potential

Larnaca is one of the growing cities in Cyprus that has attracted increasing attention from investors in recent years. The city has been actively modernising over the last 2 years with the reconstruction of the seafront, new residential complexes, commercial centres and infrastructure facilities.Larnaca Marina, with its revitalised harbour and luxury properties, deserves special attention.

Larnaca combines affordable house prices (especially compared to Limassol and Nicosia), high rental demand and a convenient location, making it attractive for both short and long term investment.The city is of particular interest to investors seeking stable capital growth and passive rental income.

Larnaca is located in the south-east of Cyprus and has one of the largest international airports in the country, making it a major transport hub.The development of the tourism sector, the construction of a new marina and improvements to the road network are enhancing its investment appeal. Unlike Paphos and Limassol, where house prices have already reached high levels, Larnaca still offers the opportunity to buy property at relatively affordable prices with the prospect of growth.

2.1 Types of investment property

Residential property in Larnaca ranges from affordable city centre apartments to luxury beachfront villas.The average price of apartments ranges from 2.5 to 4 thousand euros per square metre in the central areas, while on the outskirts you can find apartments for 1.5 thousand euros per square metre. Villas by the sea start at 400,000 euros and can reach several million, depending on the location and level of comfort.The main areas to buy a home are Mackenzie, Livadia and the city centre - especially the Finikoudes promenade and the marina.

Examples of investment apartments in Larnaca:

1. 2-bedroom beachfront apartment priced at €950,000;
2. 2-bedroom beachfront townhouse with roof garden for €450,000;
3. 2-bedroom penthouse in Mackenzie for €804 000;
4. 3-bedroom apartment in a large new complex in Meneou for 4€03 000.

Villas in Larnaca:

1. Luxurious 4-bedroom villa in Dekelia at a price of 1 350 000 euros;
2. 4-bedroom villa in a new luxury complex in Livadia at a price of €770 000;
3. 3-bedroom villa in Oroklini for €295 000.

Commercial property in Larnaca is also becoming increasingly popular with investors.New office complexes, shopping malls and hotels are being built in the city, creating good conditions for business. The cost of office space starts at 3,000 euros per square metre and retail space in popular areas is offered at 3.5-5,000 euros per square metre.Investments in hotels and apartment hotels require larger investments (from 1 million euros), but provide a stable income due to the dense and constant flow of tourists.

Examples of commercial properties in Larnaca:

1. New office in the central area at a price of 145 000 euros;
2. New shop in Aradippou at a price of 145 000 euros;
3. New hotel in Mackenzie with over 70 rooms at a price of 9 500 000 euros.

Industrial and warehouse properties remain a promising area, especially with the expansion of the port of Larnaca. Warehouses and logistic complexes can be purchased at prices from 1,500 euros per square metre and demand for such properties is steadily increasing.

2.2 Infrastructure and quality of life

Larnaca offers a pleasant environment in which to live and do business. The city has a well-developed social infrastructure, including modern medical centres, international schools and shopping centres. Larnaca also has a low crime rate, making it attractive to families with children and foreign investors.

Larnaca's mild climate and abundance of green spaces make it suitable for year-round living. The city is actively investing in transport, road improvements and the construction of new entertainment complexes. Larnaca plans to complete a number of major infrastructure projects by 2030, which will have a positive impact on property values and the attractiveness of the region for investment.

2.3. Table of advantages and disadvantages of investing in Larnaca

3. Paphos: Resort Property Investment

Paphos is a resort town that attracts investors with its high tourist potential, natural beauty and stable demand for rental properties. The town is famous for its historical sites, picturesque beaches and developed recreational infrastructure. Property investment here is mainly focused on the tourism sector and high-end residential, making the city attractive to investors looking for high yielding assets.

3.1 Property Types and Investment Areas

Residential property in Paphos is represented by luxury villas, apartments in resort complexes and small houses with sea views. The average cost of apartments is 3-4.5 thousand euros per 1 m2, and luxury villas start from 500 thousand euros and can reach several million. The main areas for investment are Kato Paphos, Pano Paphos, Peyia and Tala, where the high concentration of tourists ensures a stable demand for rental properties. The Universal urban area has also attracted interest in recent years. The upmarket areas of Kissonerga, Sea Caves, Tsada and Coral Bay can also be added to the list.

Examples of properties in these areas of Paphos:

1. 4-bedroom apartment in the highest luxury complex in Kato Paphos priced at €4 million;
2. 1-bedroom apartment in Pano Paphos with stunning sea views priced at €210,000;
3. 1-bedroom apartment in Kissonerga with stunning views for €185,000;
4. 3-bedroom house in Peyia with private pool in Peyia for €350 000;
5. 2-bedroom villa in a luxury complex in Tsada for €710 000;
6. 3-bedroom bungalow in Sea Caves for €725 000.

It is worth mentioning several golf resorts, which are not only places for aristocratic play, but also luxury residential complexes. They include all amenities, including spa centres and their own internal infrastructure.

Complexes in Paphos Golf Resorts:

1. Aphrodite Hills: apartments and villas available from 450,000 euros;
2. Minthis Resort: apartments and villas available from 655 000 euros.

Commercial properties focus on hotels, restaurants and shops. Commercial property prices average around €4,000 per square metre and profitability can be high due to the influx of holidaymakers. Investments in boutique hotels and apartment hotels are becoming increasingly popular as they allow you to make a profit even in the low season.

Examples of commercial properties in Paphos

1. 3-storey commercial building in the town centre at a price of 750 000 euros;
2. New shop in the town centre at a price of 900 000 euros;
3. 150 room hotel on the first line in Coral Bay for 17 million euros.

3.2 Infrastructure and Quality of Life

Paphos offers a high standard of living with access to the best restaurants, beaches and golf clubs. The town is popular with European retirees and wealthy expats, supporting a stable property rental and purchase market. Paphos International Airport provides convenient transport links and plans to modernise the town's infrastructure promise further property price growth.

3.3. Table of advantages and disadvantages of investing in Paphos

4. Nicosia: the business centre of Cyprus

Nicosia is the capital of Cyprus and the country's largest business centre, offering a wide range of opportunities for commercial property investors. Unlike Larnaca and Paphos, this city is not geared towards tourism, but rather attracts businessmen, civil servants and students (the capital has several universities). The main financial institutions, international companies and educational institutions are concentrated here, making the property market more stable and less dependent on seasonal fluctuations.

4.1 Types of investment property

Residential property in Nicosia ranges from low-cost apartments in the districts and suburbs to luxury apartments in modern complexes in the historic centre. The average cost of an apartment varies from €2,000 to €4,000 per square metre, depending on location and class. The areas most in demand by locals are Engomi, Aglandzia, Strovolos and Kaimakli.

Investors prefer areas as close to the centre as possible: the old town, the centre, Agia Omologitis, Dasoupolis and Engomi. Property prices here are noticeably higher, but also more dynamic.

Examples of properties in these areas:

1. 3-bedroom apartment in one of the tallest buildings in the city centre for €6.3 million;
2. 6-bedroom villa in Agia Omologitis with private swimming pool for €3.7 million;
3. 3-bedroom apartment in Engomi in a clubhouse for €330,000;
4. 2-bedroom apartment in a new complex with excellent views of the centre for 550,000 euros.

Commercial property is the main investment segment in Nicosia. There are business centres, office buildings, retail space and co-working spaces. The cost of office space starts at 3.500 euros per 1 m2, and the rent provides a stable income due to the constant demand from companies. Investors are also considering retail space, the price of which starts from 4 000 euros per 1 m2.

Examples of commercial properties available for investment in Nicosia:

1. office in a new building in Aglandja for €1.8 million;
2. office in a building in the city centre, which can be bought in floors or even as a whole at a price starting from 350 thousand euros;
3. entire apartment building in Strovolos at a price of 850 thousand euros;
4. 58-room hotel in Galata for 5 million euros.

Hotel properties in Nicosia are less in demand than in the coastal cities, but boutique hotels and apartment hotels in the old town remain a promising area. The average cost of such properties starts at EUR 1 million.

4.2 Infrastructure and Quality of Life

Nicosia is a modern city with a well-developed transport, social and business infrastructure. It is home to the country's best educational institutions, medical centres and shopping malls. Despite the absence of the sea, the city offers a high standard of living, many parks, restaurants and cultural events.

In recent years, the road network and transport system have been actively developed, making it easier to get around the city. Nicosia attracts investors with its stability, business activity and high standard of living.

4.3. Тable of advantages and disadvantages of investing in Nicosia

DOM Real Estate Agency's specialists are ready to advise you on all issues and help you choose not only the city, but also a more specific location for buying a property or investment in Cyprus. You can also contact us with questions relating to the processing of documents, residence permits - or order a turnkey property deal.

Read also:

1. Nicosia: what can you buy under €200,000?
2. Student accommodation in Cyprus
3. Permanent Residency in Cyprus in 2024
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