Cyprus Real Estate Investment
Cyprus real estate investment is very lucrative due to the island’s landscape, location, booming sectors of the economy, and tax benefits.
In this article, we will discuss residential property and commercial property investment, what the benefits are for both property investment types are as well as discussing what location is suited for your investment.
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Cyprus Real Estate Investment: Residential Property
There is a high demand for residential property when it comes to Cyprus real estate investment, especially from foreign investors. Many of these investors want to gain a passive income as well as adding to their portfolio. Residential property can be easy to maintain on your own, and collecting rent from tenants as well as resolving maintenance challenges can all be sorted by yourself if you choose to. You, the investor, can save money by doing so, although, in Cyprus, there are many companies that you can hire property managers from. This can be especially helpful if you are a foreign investor and not located in Cyprus.
Cyprus real estate investment, especially residential property investment has many perks. Cyprus has a thriving tourist industry, therefore renting luxury villas or apartments to tourists is relatively easy. The island has one of the longest vacation seasons in Europe due to the weather. Therefore, you are able to rent your property out to tourists from around May to October. And, if you do decide to do this, then you also have the benefit of being able to stay in the property yourself whenever you wish to.
Although the market was impacted by the pandemic, you can see from data collected in 2019 that rental properties are in high demand. There was an increase of 3.4% for rental prices during this year.
Furthermore, as Cyprus encourages home-ownership, investors will find an array of tax benefits as well as the possibility to apply for an EU membership. The island is also the 5th safest country in the world and has a relatively low cost of living. All of this makes it a very attractive market.
Cyprus is becoming an investment hub. There are 5 major cities or districts on the island that each offer various real estate investment opportunities. In this section we will discuss each area and what type of unique residential properties are available.
Larnaca is seeing a lot of development and new projects coming to fruition. Each of these projects has brought investment opportunities to the forefront of investors’ minds, and there is a reason why. The new residential projects are of very high-quality as well as located in up-and-coming areas, including the port and marina. Larnaca is also home to Cyprus’ primary airport therefore, foreign investors have easy access to their properties. With Larnaca being a coastal city, there are various property types to invest in. These include luxury apartments overlooking the seafront of Finikoudes, large villas on the outskirts of the city and inner-city houses.
The capital of Cyprus, Nicosia, has a very different atmosphere to Larnaca. However, it is still filled with real estate investment opportunities. Nicosia is the financial and legal hub of the island, and although there are more commercial prospects in this city, residential investment is still thriving. As this district is home to the most popular university in Cyprus, many investors take interest in university accommodation.
Limassol is arguably the most well-known city for foreign investors. This city has seen major development over the past 15 years. Due to this city being home to the largest port in Cyprus, this location brings a lot of opportunities for various types of investment along with Cyprus real estate investment. The only possible disadvantage to investing in Limassol is the property prices. Limassol is by far the most expensive city for residential property. However, it has many positives as well.
Beach front property outside of the hustle and bustle might be what you are looking for, and if it is, then you should consider investing in residential property in Protaras and Ayia Napa. There is an abundance of white sandy beaches, areas filled with entertainment and large tourist areas. If you are looking to invest in property to gain a passive income through renting to tourists, then this is definitely a location to consider. Furthermore, there has been a recent investment to build a new luxury marina that includes villas and apartments. So, this is bound to change the landscape of the area for the better.
Paphos is also a great location to invest in if you are looking for a highly renowned tourist area. It is known for being popular with British investors and families. This area of Cyprus has an extremely laid-back approach therefore, if you are looking for a quieter and more relaxing atmosphere then Paphos may be perfect for you.
Cyprus Real Estate Investment: Commercial Property
Cyprus real estate investment does not just mean residential property; it also covers commercial property and investment. A lot of people see commercial property investment as more risky than residential property investment. However, there are some lucrative opportunities in Cyprus. If you have an eye for spotting up and coming neighborhoods or understand locations with high demands for apartment blocks, then investing in commercial property is ideal for you.
You almost always need to find a location that is based near quality facilities, infrastructure, and other commercial properties. The tricky yet rewarding part to developing projects that are required to be near other, similar developments, is the need to make them of a high quality. If there are two buildings in the same location, the higher quality building will no doubt be rented first and be rented to prime tenants. When it come to locations in Cyprus, there are a number of class areas to pick from, but you must be fully aware of what each region offers.
Larnaca has seen a number of commercial property investment success over the past 5 years. As we have previously mentioned, there is the redevelopment of the port and marina as well as a new retail center set to be completed this year. Due to the new marina, investors are looking at the possibility of building luxury apartment blocks that are set to have a great return on investment. It is clear that Larnaca is becoming the rising star for Cyprus real estate investment.
We mentioned earlier how Limassol has always been the investment hub of Cyprus for residential property, and this is also true for commercial property. However, with its apartment prices increasing by 8.3% in 2019, investors are starting to show interest in other cities for investment in property such as apartment blocks. Due to Limassol being the core of international business, many Cyprus residents have chosen to live and work in the city. But as we just mentioned, prices are increasing and demand is moving.
The landscape in Nicosia is similar to Limassol in regards to the work/home lifestyle. Many residents chose to live in the capital due to working there as well. Therefore, the commercial property market is booming. As previously mentioned, the University of Nicosia is also located in the capital with Cypriot students as well as international students moving here each year. Therefore, student accommodation is always in high demand.
Cyprus real estate investment is definitely worth considering if you are looking for either commercial or residential properties. The island offers many benefits for investors, including its geostrategic location and positive tax system. Each district in the island offers something for investors and it is a buyer’s market.