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Cyprus Housing Market Slows Amid Rising Costs and Regional Divergence

by THEFUTURE.TEAM

May 27, 2025

Overview: A Cooling Market

The latest data from the Central Bank of Cyprus confirms a notable deceleration in the nation’s housing market during the fourth quarter of 2024. Overall, the House Price Index (HPI), compiled collaboratively with member banks, reflects a slowdown in price growth, largely driven by persistently high construction costs and elevated borrowing rates.

Performance Breakdown: Quarterly and Annual Trends

Quarterly figures indicate a marginal uptick in housing prices of only 0.4 percent in Q4, a decrease from the 0.9 percent observed in Q3. When examining the market by property type, the apartment segment experienced a modest increase of just 0.1 percent, in contrast to a 0.5 percent rise for houses. On an annual basis, the overall market saw prices rise by 4.5 percent in Q4, a decline from the 6.5 percent growth recorded in the previous quarter.

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Segment-Specific Insights

Digging deeper, apartment prices posted an annual increase of 5.5 percent, while house prices climbed by 4.6 percent. These figures underscore a broader market trend where indicators of slowing sales activity coincide with a growing inventory of properties available for sale or rent.

Regional Disparities: Paphos Leads, Nicosia Slips

Amid these mixed signals, regional performance varied significantly. Paphos emerged as the standout, registering a robust 13.4 percent annual increase in housing prices, the strongest growth rate in the country. In stark contrast, Nicosia recorded a marginal annual decline of 0.4 percent, marking it as the only district with negative performance. Other regions including Limassol and Famagusta also exhibited slowing annual growth at 5.1 percent and 7.8 percent respectively, while Larnaca maintained steadiness at 6.1 percent.

Market Outlook

According to the CBC’s quarterly real estate bulletin, the upward pressure on construction material costs and higher borrowing expenses remain key inhibitory factors to market expansion. The European Commission’s Economic Surveys for December 2024 further suggest that expectations for property price increases over the next three months will be subdued, reinforcing the narrative of a cooling market amid persistent financial headwinds.

Conclusion

In summary, the Cyprus housing market is undergoing a period of recalibration. While certain districts like Paphos continue to outperform, the overall slowdown, particularly in apartment segments and in key markets like Nicosia, reflects broader economic pressures. Investors and industry stakeholders will need to navigate these challenges as the market adjusts to a new normal under constrained borrowing conditions and volatile construction costs.

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Bank Of England Holds Rates At 3.75% In Split Vote As Inflation Risks Rise

by THEFUTURE.TEAM

September 17, 2026

The Bank of England kept its benchmark interest rate at 3.75% on Thursday, but the decision was not unanimous. In a 6-3 vote, the Monetary Policy Committee kept rates unchanged, while three members backed a 25-basis-point increase to 4%. Renewed energy price pressures have added to concerns that inflation could remain elevated.

Inflation Pressures Remain

Policymakers said inflation “is likely to rise further over coming quarters,” citing higher and more volatile crude oil and refined energy prices since the conflict began.

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So far, there has been “little evidence” of significant second-round effects, such as broader wage and price increases. Inflation risks, however, are now “tilted to the upside” and have increased since the July Monetary Policy Report.

Energy Prices Add To Inflation Risks

Brent crude has risen 36% since July, reaching $106 a barrel on Sept. 14, while UK wholesale gas prices increased 78% to 207 pence per therm.

Higher energy costs can feed into transport, production and household expenses, raising costs across supply chains. Refinery pressures have also pushed crack spreads, the difference between refined fuel and crude prices, well above pre-conflict levels.

Economy Shows Resilience

Despite the inflation risks, UK economic activity has held up slightly better than the Bank expected. A softer labor market and higher borrowing costs are expected to help reduce inflation over time.

Previous monetary tightening is still working through the economy, according to policymakers. So far, the latest energy shock has not produced clear evidence of a broader wage-price spiral.

Major Central Banks Take Different Paths

The decision comes during a busy period for global monetary policy. The Federal Reserve raised rates Wednesday to 3.75%-4% in its first increase since 2023, while the European Central Bank recently lifted its deposit rate to 2.5%.

The Bank of Japan is due to announce its decision Friday, with markets expecting a rate increase. Thursday’s split vote shows that pressure for tighter policy remains within the Bank of England’s Monetary Policy Committee.