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Cyprus’ Economic Recovery Confronted by a Deepening Housing Crisis

Despite a decade of notable economic resurgence, Cyprus now faces a burgeoning housing crisis that threatens to undermine its achievements. The challenge is not merely financial—it is a profound social issue impacting the quality of life for many citizens.

Economic Recovery and Social Disparities

Since 2012, Cyprus has successfully rebuilt its economy by regaining ground lost during previous financial hardships. With a rising GDP, lower unemployment, increased investment, and an enhanced international credit profile, key sectors such as tourism, services, technology, and construction have driven this robust recovery. However, the prosperity captured by headline figures is not reflected in the daily lives of countless households.

Rising Housing Costs and Their Impact

The Cyprus Borrowers Association (Syprodat) has warned that soaring purchase and rental prices have transformed affordable housing—a basic human need—into a daily struggle for workforces, families, and young professionals. Escalating construction costs, delays in permit issuance, and the absence of a comprehensive housing policy are exacerbating the crisis, pushing the country toward a narrow social impasse despite its economic gains.

Toward Sustainable and Inclusive Growth

For recovery to be sustainable, it must be coupled with social balance and justice. Economic growth should not be measured solely by indicators, but also by the ability of citizens to live with dignity, form families, and access quality, affordable homes. As the association highlights, Cyprus can continue its dynamic progress provided that development is paired with a commitment to social responsibility, equality, and real, inclusive opportunities for all.

Rolls-Royce Raises Guidance As Defense And Power Systems Drive Growth

Rolls-Royce raised its full-year profit and cash flow guidance after reporting stronger-than-expected first-half results, supported by growth across its civil aerospace, defense and power systems businesses.

Underlying operating profit rose 46% year on year to £2.5 billion ($3.3 billion) in the first six months of 2026, while revenue increased more than 24% to £11.3 billion.

The company now expects full-year underlying operating profit of £4.7 billion to £4.9 billion, up from previous guidance of £4 billion to £4.2 billion. It also raised its free cash flow forecast to £3.8 billion to £4 billion, compared with £3.6 billion to £3.8 billion previously.

Shares rose as much as 6% in early trading before paring gains to trade about 4% higher.

Data Center Demand Supports Power Systems

Chief Financial Officer Helen McCabe told CNBC that orders in Rolls-Royce’s data center power business increased by more than 50% in the first half as operators invested in backup and on-site power systems.

The company has benefited from growing demand for power infrastructure as data center operators expand capacity.

Defense Spending Provides Additional Support

McCabe also said Rolls-Royce expects to benefit from higher defense spending in the U.K. and across NATO countries. She cited the U.K.’s long-term defense investment plan, which provides funding visibility through 2030 and beyond.

“We’ve had very positive initial conversations with the new government,” McCabe said, adding that the company supports its focus on growth, defense and industrial manufacturing.

Turnaround Continues

Chief Executive Tufan Erginbilgic said the company’s transformation strategy continued to deliver results. “Our transformation continues to deliver,” he said in a statement. “We have unlocked new growth opportunities across the Group.”

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