**Cyprus Property Prices Climb as Foreign Demand Remains Strong**
Cyprus's residential property market has experienced significant growth, with house prices rising by 8.5% year-on-year in the second quarter of 2026. This increase is attributed to sustained demand from both foreign and domestic buyers, as reported by the Central Bank of Cyprus (CBC). The CBC's general residential property price index reached 109.7, indicating a 2.4% increase compared to the previous quarter.
The CBC highlighted that the robust demand for residential properties, particularly from international buyers, has been a key driver of this price surge. Additionally, the rise in construction costs has contributed to the overall increase in property values. Notably, house prices saw an increase of 5.8% year-on-year, while apartment prices surged by 8.9%.
The growth in property prices was not uniform across the island. Famagusta recorded the highest increase at 10%, followed closely by Larnaca at 9.8% and Paphos at 9.6%. Limassol, a popular destination for foreign investors, saw a more modest increase of 7.8%, while Nicosia experienced a rise of 5.7%.
The demand for properties in Cyprus has strengthened notably during the second quarter, with a total of 5,298 sale contracts deposited with the Department of Lands and Surveys. This figure represents a 15.4% increase from the 4,592 contracts recorded in the same period in 2025. The CBC noted that the surge in contracts was primarily fueled by heightened interest from foreign buyers, although domestic demand also saw an uptick, albeit at a slower rate.
On the supply side, building activity has also picked up. The number of approved residential units covered by building permits reached 8,978 in the first five months of 2026, marking a substantial increase of 63.7% compared to 5,484 permits issued during the same period in 2025. This growth in construction activity is supported by findings from the European Commission’s June economic sentiment survey, which indicated that construction remains in positive territory, suggesting a gradual increase in housing supply.
As the Cypriot property market continues to attract both local and foreign investors, the trends observed in the second quarter of 2026 may set the tone for the remainder of the year. The combination of rising prices, increased demand, and heightened construction activity paints a picture of a dynamic real estate landscape in Cyprus.