Cyprus’ largest development group, Leptos Estates, has been crunching the numbers and discovered that currently the independent Mediterranean island offers the best property investment potential in the European Union.
Set to rise further in the next 12 months, the average yield in Cyprus reached 7% in 2023, which was significantly higher than Greece (4%), Italy (3%) and France (2%) and bettered only by Ireland (8.5%).
However, a shortage of new housing in stock in Ireland is set to see this figure drop, whilst the building boom across Cyprus in recent years has seen investors boosted by a 21% average annual return on off-plan new build properties.
Further boosting the investment potential of Cyprus, the country’s GDP has grown by 5.1% in the past year, making it one of the best performing economies in the EU.
This economic growth and stability, as well as a multitude of major regeneration and infrastructure projects across the island, have been the catalyst for an unprecedented and steady increase in transactions due to the influx of tourists and overseas investors favouring a move to Cyprus and acquiring real estate.
The growth achieved led to a record year of sales for Leptos Estates, with the prime developer announcing a 15% rise in off plan property sales in 2023. On an annual basis, overseas sales (both EU and non-EU citizens) rose by 16%. 2023 saw the highest number of sales to the overseas market since the market peaked in 2007.
The prices for an off-plan properties through Leptos Estates are more attractive for the investors than when the property is completed due to the length of time it takes from purchasing the land to the property being completed and the potential increase in material and construction costs.
Purchasers then have the chance to shape the internal layout of the property from the start making important decisions of how it will look along the way.
There is also the added benefit of significant capital appreciation through the build process, which is providing investors average annual returns of over 20% currently.
An additional benefit to buying a home in Cyprus is the country’s Permanent Residence Programme, which permits foreigners to acquire a lifetime Immigration Permit for individuals and their families through property investment, starting from €300,000. This provides unlimited access to the country and across the EU, which is an increasingly enticing option for Brits finding themselves needing to adhere to strict visitation rules since Brexit (maximum of 90 days in any 180-day period).
Leptos Estates recorded a remarkable 200% increase in Permanent Residency enquiries and applications from individuals based in the UK in 2023, with a specialist support team put in place to assist with securing the right property to qualify for the residency requirements.
Cyprus also benefits from its year-round warm weather and sunshine, whilst an abundance of blue flag beaches attracts tourists from all over the world, as well as natural hotspots and mountain ranges, which includes a winter ski season, means that there is regular high demand for rental/holiday home usage.
Currently the most popular properties with British buyers seeking a part time or permanent home in the sun are apartments or self-contained villas on private resorts, with a strong community, such as Kamares Village in Paphos where prices start from €567,000 + VAT for a 2-bedroom villa.
Perched on a prominent hilltop overlooking the Mediterranean Sea, Kamares Village. With its tree lined streets and plush landscaping, has established a thriving community of expats, the community’s freehold villas creating a country club atmosphere, with numerous social events and activities organised at the Kamares club, which is situated at the heart of the development.
Pantelis Leptos, Co-President of Leptos Group of Companies, said, “Cyprus continues to be a popular choice for purchasers particularly from Britain looking for a destination that can provide the best guarantee of year-round sun, whilst also re-establishing the benefits of freedom of movement across Europe that has been lost since Brexit.
“Due to its thriving economy and numerous substantial development projects, Cyprus is now being recognised as a leading global luxury investment destination. We have seen a marked increase in sales to those buying not only for the Residency programme but also to make the country a place to call home be it permanently or as a major base during business or travel through the year.”
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