Cyprus residential construction costs hit record high in 2025

Construction prices for new residential buildings in Cyprus climbed to their highest level on record in 2025, according to new Eurostat data, reflecting a broader increase in building costs across the European Union over the past decade. The numbers were published in the 2026 edition of Eurostat’s Key Figures on European Business, which brings together data on business activity, investment, productivity, technology, globalisation and tourism across the bloc. Moreover, the figures focused on the producer price index for the construction of new residential buildings, excluding communal residences. The indicator measures construction prices from the perspective of builders and is based on the prices paid by clients to contractors. In Cyprus, the index reached 118.0 points in 2025, up from the base level of 100 points in 2021. This means that the cost of constructing new residential buildings in Cyprus increased by approximately 18 per cent over the four-year period. Looking further back, the data show that construction costs in Cyprus were relatively stable in the years preceding the pandemic before gradually edging higher. The index stood at 90.2 points in 2015, slipping slightly to 89.5 points in 2016 and holding broadly steady at 89.6 points in 2017. It then rose modestly to 90.7 points in 2018 and 92.7 points in 2019, before inching up further to 92.9 points in 2020. The figures show that the post-2020 period marked a clear break from this prolonged phase of subdued pricing, with a sharp acceleration in costs from 2021 onwards. The index increased from 100 points in 2021 to 111.7 points in 2022, representing an annual rise of 11.7 per cent. Construction prices continued to increase in 2023, when the index reached 114.8 points, reflecting annual growth of approximately 2.8 per cent. The upward trend persisted in 2024, with the index climbing to 115.7 points, an increase of around 0.8 per cent compared with the previous year. In 2025, the index rose further to 118.0 points, marking annual growth of approximately 2.0 per cent. The figures indicate that while the pace of price increases has eased since the post-pandemic surge experienced across Europe, construction costs in Cyprus continue to trend upwards. Across the EU, prices for the construction of new residential buildings increased by 48.2 per cent between 2015 and 2025. A significant share of that increase occurred during the period of heightened inflation and supply chain disruptions that followed the pandemic. Eurostat reported that annual growth in construction prices reached 5.8 per cent in 2021, before accelerating to 12.2 per cent in 2022. The rate of increase remained elevated at 6.9 per cent in 2023. Growth then slowed considerably, reaching 2.3 per cent in 2024 and 1.3 per cent in 2025. The figures reveal substantial differences between member states. The steepest increases over the decade were recorded in Bulgaria, where residential construction prices surged by 166.1 per cent. Hungary followed with an increase of 155.4 per cent, while Romania recorded growth of 130.7 per cent. At the other end of the spectrum, the smallest increases were observed in Italy, where prices rose by 17.0 per cent between 2015 and 2025. Greece recorded the second-lowest increase at 17.3 per cent, while Finland saw prices rise by 22.1 per cent over the same period. Cyprus’ national index trend shows a gradual rise from 2015 to 2020 followed by a sharper inflation-driven acceleration after 2021, with costs reaching their peak in 2025. The latest figures come as Cyprus continues to experience strong activity in the property and real estate sectors, with developers and contractors facing ongoing pressures linked to labour costs, building materials and broader inflationary trends. They also provide an indication of the cost pressures affecting housing supply, a factor closely watched by policymakers and the real estate industry amid concerns over housing affordability.