The slowdown in housing price increases in Cyprus persisted into the fourth quarter of 2024, according to the House Price Index (HPI) compiled by the Central Bank of Cyprus (CBC) in collaboration with member banks of the Association of Cyprus Banks. The main reasons for the deceleration remain the high cost of construction materials and elevated borrowing costs.

According to the CBC’s quarterly report, the annual increase in the general HPI (covering both houses and apartments) continued to slow in Q4 2024, with apartment prices showing a sharper deceleration compared to house prices.

The CBC notes that various indicators suggest a broader slowdown in the real estate sector, as reflected in the deceleration of property sales and a rise in housing supply—evident in the increased availability of properties for sale and rent.

“Expansion in the real estate sector is being held back by persistently high construction material costs and borrowing rates, which remain elevated compared to the previous five-year period,” the report underlines.

The trend is further supported by declining price expectations, as reflected in the European Commission’s Economic Sentiment Surveys (December 2024).

More specifically, the general HPI recorded a quarterly increase of 0.4% in Q4 2024, down from 0.9% in the third quarter. This was due to a 0.5% rise in house prices and a mere 0.1% increase in apartment prices over the same period.

On an annual basis, the growth in overall residential property prices slowed to 4.5%, compared to 6.5% in Q3 2024. Apartment prices rose by 5.5% year-on-year, while house prices increased by 4.6%.

According to Land Registry data cited by the CBC, the total number of property sale contracts (covering all property types) recorded a slight annual increase in Q4 2024, driven by both domestic and foreign buyers.

At the district level:

• Paphos was the only district to see an acceleration in house price growth, recording a 13.4% year-on-year increase in Q4.

• In contrast, price increases decelerated in Nicosia (0.7%), Limassol (4.4%), Larnaca (6.5%), and Famagusta (9.2%).

• For houses specifically, annual price growth accelerated in Paphos (14.7%), while Limassol (5.1%) and Famagusta (7.8%) recorded slower growth. Nicosia experienced a slight decline (-0.4%), and Larnaca remained stable at 6.1%.

For apartment prices, annual growth slowed across all districts:

• Nicosia: 2.6%

• Limassol: 5.5%

• Larnaca: 8.7%

• Paphos: 12.1%

• Famagusta: 14.2%

The number of sale contracts increased year-on-year in all districts except Nicosia and Famagusta, where declines were recorded.

Meanwhile, the upward trend in building permits indicates that housing supply continues to grow.