Cyprus is considered the pearl of the Mediterranean, not only because of its comfortable climate, but also because of the attractive investment conditions. The coast of the island is an almost unbroken line of beaches, making Cyprus a popular destination for tourists from all over the world. But about everything in order.
The authorities of the Republic of Cyprus are trying to create more opportunities for investment. In particular, in 2013, the government initiated, and in 2024 extended, the “Build to rent” program. It involves the construction of additional areas by increasing the coefficient of vacant real estate by 45%.
In accordance with this program, slightly less than half of the apartments or premises in the facilities under construction will go on free sale. The government also decided that at least a quarter of this amount should be sent to the market at discounted prices. In addition, local developers are encouraged with benefits and refunds for the construction of additional areas corresponding to 10-20% of the cost.
The second program is called “Renovate to Rent”. It allows property owners to invest in the renovation of facilities for their subsequent rental. According to the decree, the state will subsidize 40% of the renovation costs.
In addition, Cyprus provides citizenship for investors. To do this, you need to invest at least 300,000 euros in real estate or securities. The applicant’s annual income must be at least 50,000 euros.
How to buy a property in Cyprus
Next, we will talk about five cities in Southern Cyprus that are worth the attention of real estate investors.
Limassol
Limassol is the main artery of Cyprus’ maritime traffic. It includes three ports: the Old Port of Limassol, Limassol Marina, and the new port of Limassol. The first two form the popular Limassol Marina tourist area, where luxury accommodation and villas are located. The new port provides 80-90% of the total tourist flow to the island via cruise liners and ferries. The negative point is the fact that Limassol’s housing prices are quite high.
Advantages and distinctive features of this city:
- Infrastructure and development. The city is known for its well-developed infrastructure, including modern business centers and municipal institutions. In recent years, high-end commercial real estate and luxury housing have been actively developing here.
- An economic and business center. Thanks to the ports, most of the commodity traffic passes through the city, which has made the city the financial center of Cyprus, which makes commercial real estate in Limassol also relevant for investment.
- Cultural attractions. The city offers a wide range of cultural and entertainment activities, ranging from Limassol Marina to various festivals and events throughout the year. The proximity to the Troodos Mountains and beaches increases its attractiveness for both tourists and residents.
Limassol’s attractiveness to investors and the strengthening of its real estate market is due to tourism and international business. This contributes to a constant increase in the value of real estate and the demand for improving the infrastructure of the city. Gross rental yield in Limassol as of the first quarter of 2023 was 4.93%, which is the highest in Europe.
The city is ideal for businessmen, expats and investors seeking to make an investment in Limassol real estate and make a profit from renting. It is also suitable for those who are looking for a vibrant holiday on the beaches of the Mediterranean with access to modern amenities and cultural activities.
Average real estate prices in Limassol:
Type of real estate |
Average purchase price (€/m2) |
Average rental price (€/m2) |
Apartments |
€2500 |
€15 |
Pitchforks |
€3500 |
€20 |
Source: Numbeo.
Pathos
According to legend, the goddess Aphrodite appeared from the sea foam on the coast of this city. Paphos is replete with cultural attractions, which imposed restrictions on the development of the city and infrastructure. Therefore, the city was divided into new and old parts. The new one is the center of life, business and leisure, the old one is the cultural heritage of the European nation and is included in the UNESCO World Cultural Heritage list. In 2017, the city was awarded the title of the cultural capital of Europe.
Advantages and distinctive features of Paphos:
- The richest cultural heritage. There are a huge number of attractions and monuments in the city and its boundaries, including the Archaeological Park of Paphos and the Tombs of Kings.
- The development of the real estate market. Cultural attractiveness contributes to the influx of investments in Paphos real estate and increases the demand for market development in the tourism sector.
- Prospects for commercial real estate. The city is home to the second largest airport in Cyprus, which accepts not only tourists, but also commercial cargo. This creates demand for various types of real estate in Paphos, including commercial.
- The unhurried rhythm of life. A more peaceful and measured life compared to other cities, especially Nicosia and Limassol.
Paphos is ideal for retirees, families and individuals looking for a peaceful and rich cultural environment. And also for investors interested in affordable real estate.
Average real estate prices in Paphos:
Type of real estate |
Average purchase price (€/m2) |
Average rental price (€/m2) |
Apartments |
€1900 |
€12 |
Pitchfork |
€2500 |
€15 |
Source: Numbeo.
What is happening in the Cyprus real estate market in 2023? Fresh analytics on prices and demand
Nicosia
Nicosia is a unique city that is the last divided capital in the world. The line of demarcation between the northern and southern parts of the island runs through it. The so-called “Green Line” consists of abandoned buildings, walls and fences with five checkpoints along its entire length, the main ones being Ledra Street and Ledra Palace. Due to the fact that the city is located in the center of the island and has no access to the sea, the demand for residential real estate in Nicosia is slightly lower than in the coastal parts of Cyprus.
Advantages and distinctive features:
- Capital. Nicosia is the administrative and financial center of the country. The infrastructure is better developed here: the main educational institutions such as the University of Cyprus and large business centers are located here.
- The business center. Large international companies choose Cyprus and its capital for the location of their head office. This is due to the convenient location of the island between Europe and Asia.
- Nice prices. Real estate prices in Nicosia are not the highest in Cyprus — the capital’s real estate is more in the medium-high price range.
The heart of the capital is a fortress from the period of Venetian rule and it is also divided by a demarcation line. The Nicosia City Planning Department has initiated a number of programs aimed at strengthening business activity on the territory of the fortress.
In particular, the department offers grants for the restoration of abandoned premises for further commercial activities. In addition, the Government encourages the expansion and modernization of existing facilities and the relocation of economic activities to the fortress area. Thus, buying a property in Nicosia can be beneficial from the point of view of falling under such government programs.
The city is suitable for those who travel to Cyprus in search of a high-paying job, as the salary level in Nicosia is on average higher than in other cities of Cyprus. Expats and their families will find a stable economic environment, modern educational and medical facilities.
The location of the city in the interior of the island makes it less attractive for tourists and more interesting for business and living.
Average property prices in Nicosia:
Type of real estate |
Average purchase price (€/m2) |
Average rental price (€/m2) |
Apartments |
€2200 |
€12 |
Pitchforks |
€3000 |
€18 |
Source: Numbeo.
Larnaca
Larnaca is the third largest city in Cyprus, which is located just 40 kilometers from Nicosia. There is an airport and a port here, which make it the logistics center of the island, processing up to 40% of the total goods flow of Cyprus. And the long coastline makes this city attractive for tourists. Moreover, the government is placing increasing emphasis on the development of Larnaca as a tourist destination. So, over the past six years, 15 new hotel facilities have been built in the city, and another 25 are in the process of construction.
Cyprus real estate market overview: the cost of housing, popular areas for investment and conditions for obtaining permanent residence
Advantages and distinctive features of Larnaca:
- A universal logistics hub. The city has a large airport, like in Paphos, and an active port, like in Limassol. This has a positive effect on investments in commercial and industrial real estate.
- The development of tourism. In the last decade, the emphasis in Larnaca has shifted in favor of the development of the tourism sector, which makes it profitable for investments.
- Diving. It is the most famous and popular diving spot in all of Cyprus.
The Larnaca real estate market is in a unique state where primary real estate is 34-36% cheaper than secondary real estate. In other cities, this figure is slightly more modest, and amounts to 21-27%. The state is creating the potential for investments in secondary real estate in Larnaca for subsequent renovation and sale or rental.
Real estate sales in April 2024 alone increased by 44% compared to the same month in 2023. At the same time, real estate prices in Larnaca are formed disproportionately to demand, which is why the average annual price increase was only 7.7%.
The urban landscape is diverse and includes an industrial part, attractive for manufacturing companies, and a residential area for comfortable living for pensioners or families. The coastal area of Finikoudes is suitable for young and active people, on the promenade of which the main activities of the city are concentrated and various festivals are held.
Average real estate prices in Larnaca:
Realty |
Average purchase price (€/m2) |
Average rental price (€/m2) |
Apartments |
€2200 |
€13 |
Pitchforks |
€2800 |
€16 |
Source: Numbeo.
Ayia Napa
Ayia Napa is a real resort town. About half of its beaches have been awarded the “Blue Flag” award — it is given only to beaches where the water meets high standards of quality, cleanliness and safety. And the rich nightlife and the amusement park Parko Paliatso, located right in the city center, only strengthen this status.
Advantages and distinctive features:
- The center of nightlife. The city is famous for a wide range of entertainment for lovers of nightlife. Themed bars, cafes, clubs and seasonal events attract tourists from all over the world.
- Development of the tourism sector. The Government is conducting a number of programs to renovate beaches and improve their convenience. It also collaborates with developers on luxury real estate projects such as Ayia Napa Marina.
Buying a property in Ayia Napa for subsequent rental is a good investment for investors who are not afraid of fluctuations related to the seasonality of the tourism sector. The city is developing a sector of elite commercial and residential real estate.
The main tourist contingent of the city are young people who are in search of activities and entertainment, as well as those who are more focused on beach holidays. During the off-season, the temperature remains comfortable, and the flow of tourists weakens, which makes the stay pleasant for pensioners and couples.
Average real estate prices in Ayia Napa:
Type of real estate |
Average purchase price (€/m2) |
Average rental price (€/m2) |
Apartments |
€2500 |
€14 |
Pitchforks |
€3200 |
€18 |
Source: Numbeo.
So which city should I choose?
In order to finally figure out where it is better to buy real estate in Cyprus, let’s summarize the information for each city:
Limassol
The city boasts excellent infrastructure, several Blue Flag beaches and a high quality of life. However, there is a higher cost of living and more traffic jams.
Pathos
Paphos is rich in historical heritage and cultural attractions. It offers a relaxed lifestyle, affordable real estate prices and high rental demand from tourists. There are many UNESCO World Heritage Sites in the city.
Nicosia
The capital of Cyprus is the administrative and business center of the island. Nicosia offers a stable economic environment, high-quality education and medical facilities. However, there is no coastline, and the cost of living is higher than in other cities and real estate prices are second only to Limassol.
Larnaca
Larnaca is known for its beautiful beaches and peaceful coastal lifestyle. The main international airport is located here, which makes this place very accessible. The city offers affordable real estate prices. At the same time, the demand for beach real estate is constantly growing.
Ayia Napa
A resort town with a vibrant nightlife and magnificent beaches marked with the “Blue Flag”. The city has a high seasonal demand for rental housing and luxury real estate is developing.
So, Limassol is for work and leisure, Paphos is for cultural recreation and rental, Nicosia is for business and family life, Larnaca is for coastal and affordable living, and Ayia Napa is for tourism—oriented investments.
Author
Mikhail Konon is a copywriter
I write informative articles about real estate, investments, job search and taxes.