Buying for Investment

Buying property in Cyprus for letting is not allowed to foreigners except in the case where an already owned residence is rented to permanent residents for periods of more than 28 days. For this reason a holiday home or a permanent retirement home cannot be looked upon as an investment for income as such. Nevertheless local property values have shown a steady upward movement over the years and property, especially near the beach, has shown a considerable appreciation. This appreciation holds good mainly for particular projects and not so much for the odd apartment here and there. Beach property is much in demand and we foresee a considerable appreciation over the near future. Joining the EU in May 2004, has caused an appreciation in local property values. In addition local holiday home projects are priced between 20% and 30% lower, than a comparative counterpart in Portugal or Spain. Local property is therefore believed to offer good value for money and the island’s increasing popularity by the international market further supports this.

As a general rule we could say that property income returns are in the region of 5% - 8% p.a. of the current value. In addition the annual appreciation on real estate values are in the region of 5% -10% (depending on location etc). Therefore a total return of approximately 10% to 18% p.a. could be realised, for this reason Cyprus is highly recommended for Real Estate Investment.