Despite a stabilising economy and buyers taking advantage of low property prices in the country, house prices in Cyprus showed a ââ¬Ëdisappointingââ¬â¢ fall in the fourth quarter of 2010. The Royal Institute of Chartered Surveyors (RICS) Cyprus Property Price Index found that values of both houses and apartments fell slightly at the end of last year.
Small price falls despite increased overseas interest in cheap Cyprus property
The RICS research found that house prices fell by an average of 2.6 per cent in the final quarter of 2010 whilst apartment prices dropped by an average of 2.4 per cent.
According to Pavlos Loizou MRICS, board member of RICS Cyprus: ââ¬ÅDuring the second half of 2010 Cyprus bore the aftershock of the global economic crisis, with the economy slowing down and the governmentââ¬â¢s income decreasing.
ââ¬ÅTowards the end of the year there were some early signs of price stabilisation, with local buyers returning to the market taking advantage of lower prices for holiday homes and for permanent residence. Also, there seemed to be some renewed investor interest, particularly for city centre, prime, properties. Evidence of this however is anecdotal, as there have been no significant transactions to support it.ââ¬Â
Rents also fall for property in Cyprus
The RICS study also found that rents in Cyprus had also fallen which is likely to increase the downward pressure on prices. If you are planning to buy an investment property in Cyprus, falling rents mean you will want to drive a hard bargain on the price in order to ensure your rental yield remains strong.
Across Cyprus, rental values for apartments fell by 5.5 per cent and by 5.9 per cent for houses. Year-on-year, rents dropped by 7.2 per cent for apartments and 11.8 per cent for houses.
Cyprus Property News reports that ââ¬Ëthe reduction in rents will have a profound effect on the incomes of many local and overseas owners, and is likely to increase the downward pressure on prices as the mismatch between rent and capital values is accentuated.ââ¬â¢
