Cyprus’s residential property market continued to strengthen in the second quarter of 2026, with house prices rising 8.5% year on year, according to the Central Bank of Cyprus (CBC). The latest figures point to a market still being supported by robust demand from both foreign and domestic buyers, alongside higher construction costs.
Prices Advance Across Most Segments
The CBC’s general residential property price index reached 109.7, marking a 2.4% increase from the previous quarter. House prices rose 5.8% annually, while apartment prices posted a sharper 8.9% increase, underscoring continued appetite for urban housing stock.
Follow THE FUTURE on LinkedIn, Facebook, Instagram, X and Telegram
Price growth accelerated in all districts except Limassol. Famagusta recorded the strongest annual increase at 10%, followed closely by Larnaca at 9.8% and Paphos at 9.6%. Limassol saw prices rise 7.8%, while Nicosia registered a 5.7% increase.
Foreign Buyers Remain A Key Driver
The central bank said the market’s momentum was driven primarily by strong demand for residential property, especially from overseas buyers. Domestic demand also remained supportive, though the pace of growth was more measured.
That trend was reflected in transaction activity. A total of 5,298 sale contracts were deposited with the Department of Lands and Surveys in the quarter, up 15.4% from 4,592 in the second quarter of 2025. The CBC said foreign demand was the main contributor to the increase, with local buyers also continuing to participate in the market.
Supply Is Beginning To Respond
On the supply side, building activity also picked up. Approved residential units covered by building permits reached 8,978 in the first five months of 2026, compared with 5,484 in the same period a year earlier — an increase of 63.7%.
The CBC also pointed to the European Commission’s June economic sentiment survey, which showed construction activity remaining in positive territory. That suggests housing supply may continue to rise gradually, although likely not fast enough to offset demand in the near term.
A Market Still Tilted Toward Sellers
For now, Cyprus remains a market where demand is outrunning supply in several areas. With foreign capital still active, domestic buyers resilient, and construction costs elevated, price pressure is likely to persist unless new supply accelerates meaningfully.
