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Cyprus Rents Rise 30–40% As Housing Demand Outpaces Supply

Escalating Rent Increases And Market Pressures

Cyprus now faces one of the EU’s most severe housing pressures, with recent reports indicating rent hikes of 30-40% over the past five years. According to Stefanos Stefanou, General Secretary of AKEL, these unprecedented increases have left many Cypriots grappling with soaring living costs. At a recent event at the European Union House in Nicosia, organised in collaboration with the European Parliament Office in Cyprus, MEP Giorgos Georgiou emphasised the urgent need for a comprehensive housing strategy.

Housing Demand Outstripping Supply

Data from the European Commission indicate that Cyprus will require approximately 43,000 new housing units over the next decade to meet demand. At the same time, nearly 270,000 residents are classified in the lowest income bracket. According to the national statistical service, more than 140,000 people live at or below the poverty threshold with annual income under €15,500, while an additional 213,000 in the lower middle-income group face similar financial pressure.

Policy Gaps And Market-Driven Vulnerabilities

Lack of a coordinated state housing policy continues to affect market conditions. Stefanou said existing measures remain fragmented and do not address structural issues in housing access. He also warned that without targeted support programmes, risks linked to rising housing costs could increase. The financial ombudsman has indicated that, if current trends persist, foreclosures on primary residences could rise from 2026.

Government Initiatives And Strategic Proposals

The Ministry of Interior has introduced a housing strategy aimed at increasing residential supply, with a focus on affordable housing. Measures include urban planning incentives and the “Build to Rent” scheme, implemented in cooperation with the private sector. Plans target the construction of more than 2,500 housing units over the next two years, including around 400 designated as affordable homes.

Addressing The Role Of Foreign Investment

Local officials, including Andreas Vyras, pointed to the impact of foreign investment on the property market. In Limassol, rental prices have increased significantly in recent years, while a large share of city-centre properties has shifted toward short-term rental use. Reports indicate that a substantial portion of housing supply is now oriented toward foreign buyers and investors.

Toward A Comprehensive Housing Policy

Policy proposals discussed include the creation of a central housing authority and the development of state-backed financing mechanisms for housing programmes. Additional measures focus on regulatory frameworks aimed at protecting primary residences and improving access to housing for lower-income households.

Future Outlook And Critical Interventions

Georgiou said current approaches, which focus on market incentives and construction activity, may not be sufficient to address affordability challenges. Discussions include potential regulation of short-term rentals and targeted legislative measures to stabilize housing conditions across cities, including Nicosia and Limassol.

Eurobank Wins Two Euromoney Awards Following Cyprus Merger

Eurobank has been named Cyprus’ Best Bank for 2026 by Euromoney, while also receiving the award for Best Bank for Large Corporates at the publication’s latest Awards for Excellence.

Merger Marks A Milestone

The awards recognise the bank’s performance during 2025, a year marked by the completion of the legal merger between Hellenic Bank and Eurobank Cyprus. The transaction created Eurobank Limited, which the group says is now Cyprus’ largest banking and insurance organisation, with assets exceeding €28 billion.

Euromoney’s Awards for Excellence evaluate banks’ performance over the previous calendar year, with this edition covering January 1 to December 31, 2025.

Lending, Customers And Digital Growth

Eurobank said its business lending portfolio expanded by around 17 per cent during 2025, while its customer base grew to more than 710,000 retail clients and 11,500 business customers.

The bank also continued its digital expansion, saying more than 96 per cent of transactions are now completed through digital channels, and most financing applications are submitted via its mobile app.

Expanding International Presence

Eurobank also highlighted the opening of its first representative office in India, describing the move as a step toward strengthening business links between Cyprus and India while supporting Cyprus’ role as a gateway to the European Union for Indian businesses and investors.

According to the bank, Euromoney recognised not only the successful completion of the merger but also its lending growth, digital transformation and contribution to Cyprus’ position as an international business and investment hub.

CEO On The Awards

“The Euromoney awards confirm Eurobank’s strong momentum and the successful implementation of our group’s strategy in Cyprus,” Chief Executive Michalis Louis said.

He said the merger strengthened the bank’s ability to support households, businesses and the wider economy, while highlighting continued investment in digital services and the opening of the representative office in India as key milestones during the year.

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