Nearly 2 in 5 property sales in Cyprus go to foreign buyers, highlighting a notable shift in the real estate landscape. The latest report from the Central Bank of Cyprus (CBC) reveals that the third quarter of 2025 saw a significant increase in property transactions involving foreign nationals.
According to the Residential Property Price Index (RPPI) report published on Tuesday, the total number of sales documents recorded by the Department of Land and Surveying (DLS) experienced a robust annual increase. Sales to foreign buyers rose by 9.3% year-on-year, climbing from 1,672 in the third quarter of 2024 to 1,827 in the same quarter of 2025.
Domestic buyers also contributed to this positive trend, with their sales increasing by 8.6%, from 2,409 to 2,617 during the same period. This collective rise led to an overall increase of 8.9% in total property sales, with 4,444 documents filed compared to 4,081 in the previous year.
Foreign buyers: Regional Variations in Sales Transactions
The distribution of property transactions varied across Cyprus’s districts. Limassol emerged as the leading area for property sales, recording 1,431 transactions, followed by Nicosia with 981, Larnaca at 921, and Paphos with 878. Famagusta trailed with the fewest transactions at just 233.
In Paphos, foreign buyers accounted for a remarkable 68% of all transactions, reflecting a strong preference for this district among international investors. In contrast, domestic buyers dominated in Nicosia, Limassol, Larnaca, and Famagusta, each exceeding 50% of transactions.
Price Trends in the Property Market
The General Residential Property Price Index (RPPI) continued its upward trajectory in the third quarter of 2025, with an overall annual increase of 5.0%. This marks a slight acceleration from the previous quarter’s 4.7% increase. Notably, apartment prices saw an accelerated growth rate of 6.4%, while house prices experienced a deceleration, rising by 2.6%.
Regionally, Limassol and Larnaca recorded the most significant price increases, with 7.1% and 7.3% respectively. However, Nicosia and Famagusta experienced slight declines in their property price indices, at -0.5% and -0.3% respectively. Paphos, despite its deceleration, still posted a healthy annual increase of 8.9% in its price index.
Shifts in Demand for Property Types
The preferences of buyers are shifting, with a growing demand for smaller properties due to rising construction costs. Data from new residential loan issuance supports this trend, showing a substantial annual increase of 22% for the January to September 2025 period, totalling €972 million compared to €796.8 million in the same timeframe the previous year.
For the third quarter alone, there was a remarkable annual rise of 24% in new residential loan issuance compared to the third quarter of 2024. The average interest rate for housing loans fell to 3.03% in September 2025, down from 4.27% a year prior, further stimulating demand and allowing for a gradual increase in the supply of residential properties.
Construction and Future Prospects
The number of residential units approved for construction, a key indicator of future activity, rose by 4.6% for the January to July 2025 period, from 7,772 units in 2024 to 8,128 in 2025. This suggests a promising outlook for the supply of residential units in the coming years.
Despite the general trend of price increases, the construction materials price index recorded a modest annual rise of 1.3% in the third quarter of 2025, remaining at historically high levels due to ongoing geopolitical developments and supply chain challenges. The expectations index for property prices, as indicated in the European Commission’s Economic Sentiment Surveys conducted in September 2025, suggests a potential deceleration in house prices, with fewer participants anticipating further increases.
