In May 2025, Cyprus formally announced joining the Schengen Area by 2026. This decision marks one of the most significant developments in the country’s European integration since it joined the EU in 2004. The move, confirmed by President Nikos Christodoulides, brings an end to years of negotiations and marks the final step in Cyprus’s full integration into the European Union’s free movement framework.
What does joining the Schengen area actually mean? In the broadest terms, it allows Cypriot residents and visitors to travel freely across 29 European countries without internal border checks. It places Cyprus into one of the EU’s most important mobility frameworks, a system used daily by millions across Europe for work, business, and tourism. For companies based in Cyprus, it offers simpler access to the European single market, fewer logistical hurdles, and reduced barriers to doing business across borders.
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At the same time, it strengthens Cyprus’ position within Europe. This is not just a political milestone, but also carries significant commercial implications. With its Schengen status secured, the island can now compete more directly with other EU jurisdictions when it comes to attracting investment, skilled workers, and international companies.
The Investment Case
For investors, Cyprus’s inclusion in the Schengen Area is expected to resolve a long-standing blind spot. While the country has been part of the European Union for more than two decades, the absence of Schengen membership has often been cited as a limitation, particularly when compared to other EU jurisdictions offering greater mobility and access.
“This will be a milestone for the development of the Cyprus economy,” says Yangos Hadjiyannis, CEO of CIM-Cyprus Business School. “Not being part of Schengen has been a real constraint. Investors always compare countries to opt for the best possible option, and Cyprus has often fallen short on that point.”
He sees Schengen accession not just as a political upgrade, but as a “historic step to transform” Cyprus’s business reputation. “It strengthens our image as a complete and credible EU partner. It also eliminates lingering doubts about our ability to monitor and manage our borders, which has an impact on how Cyprus is perceived internationally.”
Hadjiyannis also points to the implications for Cyprus’ ambitions as a regional hub for Europe, the Middle East, and beyond. “A stable entry into the Schengen Zone might make Cyprus a more attractive destination for foreign investors who seek a connection within the EU. The perception of increased stability and security can enhance investor confidence.”
Real Estate and Development
Cyprus’ upcoming Schengen accession will change the dynamics of the property market. Viktoria Iatsiuta, of MYSPACE Real Estate and VIDI Group Cyprus, predicts a 20–35% price increase in premium residential property in the two to three years following accession. The impact will not be limited to prices, but also on the types of buyers entering the market and the kinds of projects developers are planning and prioritizing.
A great deal of the new demand is expected to come from non-EU citizens, especially from countries like Russia, China, India, and the Gulf. “Residency in Cyprus will now offer freedom of movement across the Schengen area,” Iatsiuta says. “That makes the island far more attractive for international buyers looking for both freedom of movement
She notes that properties targeting tourism will most likely benefit the most. The demand for resort developments, for instance, coastal villas and modern residential complexes, will increase exponentially over the next three to five years. Over the last couple of years, developers have already responded with a visible increase in new projects that offer amenities aimed at international buyers.
The commercial real estate market is also set to expand. Iatsiuta expects a 15–20% increase in demand for modern office space and retail units, driven by companies looking to establish or expand their presence in Cyprus. “With improved access to the rest of Europe, we anticipate more regional activity, especially from firms using Cyprus as a base for operations within the EU,” she says.
But she also points to potential risks. “The rising demand could make housing less affordable for locals,” she explains. “And any overdependence on foreign capital could expose the market to external shocks.”
Still, the overall outlook remains optimistic. “We’re likely to see growth not just in housing, but in surrounding infrastructure: education, healthcare, and commercial services,” Iatsiuta adds. “If we manage this growth wisely, the benefits will extend beyond property and into the broader economy.”
Tech, Startups, and the Digital Economy
Cyprus has been gradually emerging as an attractive base for tech founders, digital nomads, and early-stage companies thanks to its low corporate taxes, straightforward incorporation process, and a growing international IT community. But for many in the startup world, the lack of Schengen membership has been a practical barrier, one that is about to be removed.
“It sounds incredible, but it’s true: Cyprus has met all the EU requirements for joining Schengen,” says Oleg Reshetnikov, founder of Cyprus_iT and a long-time advocate for the island’s tech scene. “The island will become more accessible to digital nomads and those who are launching startups.”
The perks? “British Intellectual Property Rights, several types of VNH for visitors, start-ups, techno nomads, a large IT community, and several business clubs, startup accelerators, several universities whose students can potentially be project participants and future employees, the opportunity to obtain citizenship of Cyprus in 4/5 years.” And the list goes on.
He points out that for digital nomads and tech companies, the ability to move freely between Schengen countries makes Cyprus more attractive as a base of operations. Combined with incentives such as the European Blue Card and startup visa programmes, the country’s ecosystem could see stronger links to founders and talent from across the continent.
Legal and Political Significance
For Yiannos Georgiades, a lawyer and advisor with long experience in EU legal affairs, Cyprus’ accession to Schengen is both practically and politically important.
“Cyprus’ full accession to the Schengen Area is a significant moment,” he says. “It affirms the country’s position at the heart of the European Union and brings real benefits for citizens, businesses, and investors.”
While acknowledging the complexities of Cyprus’ geopolitical situation, namely the continued occupation of its northern territory, Georgiades views the decision as a reaffirmation of the country’s European identity and a strong message of EU solidarity. “It shows that Europe is committed to including all of its members fully, even in difficult political circumstances.”
On the business side, he points to tourism, professional services, and trade as areas likely to benefit from the removal of internal border restrictions. But the long-term value, he says, lies in trust and continuity.
“This strengthens cross-border cooperation, encourages long-term planning, and helps position Cyprus not just as a participant, but as a contributor to the European project,” Georgiades adds. “It’s a step forward, both for Cyprus and for Europe.”
