Property expert points to time-consuming licensing process for new investments
Although people may complain about the rising prices, Cyprus’ real estate market is still an ideal sector to invest for long-term security and prosperity, said Yiannis Misirlis, chairman of the Imperio Group, a Limassol-based property development and management firm.
“Apart from offering substantial financial growth potential over time, investing in the Cyprus’ real estate sector may also generate long-term rental yield,” said Misirlis, who is also the president of the Cyprus Property Developers Association.
“Cyprus’ strategic location, stable economy and demand-driven market make the real estate sector an especially attractive and low-volatility choice for investors looking for steady returns.”
Most Cypriots argue that they cannot afford to buy a property in Limassol, where property prices have been steadily rising, but this is the result of demand and supply.
“Strong demand and limited supply are an ongoing issue that has grown over time and has transformed the real estate market in Limassol, which is reflected in the city’s present real estate prices,” said Misirlis.
The issue, he said, dates back some years when a supply chain problem occurred, resulting in high transportation costs, delays in the delivery of building supplies, etc. This was made even worse by the onset of the Covid-19 pandemic.
“Notwithstanding the challenges encountered in recent years, the market’s size is still increasing by 10 per cent on a year-by-year basis, which exacerbates the housing crisis as there is a shortage of units to meet demand,” said Misirlis, who is optimistic about the town’s prospects.
“Limassol’s strong infrastructure, coastal charm and strategic economic significance draw in a wide range of investors, generating interest from both domestic and foreign markets,” he said although he conceded there were still problems posed by bureaucratic delays.
The time-consuming licensing process for new investments, he said, “is a huge obstacle for the market’s growth and can severely restrict supply”.
Accelerating this process was crucial for sustainable growth. “The strong demand can be better met by reducing bureaucratic delays and encouraging proactive collaboration between the private sector and authorities. Authorities should establish a relevant framework, while the private sector must be provided with adequate and appropriate incentives to implement it.”
This would allow the supply to grow and eventually cause a market correction. Examples of improvement he cited, included the government’s updated incentives for affordable housing and the implementation of a new housing policy, which could set the stage for the correction of bad practices in the market.
He sees cooperation between authorities and the private sector as essential to maintaining stability and ensuring a sustainable, balanced market environment.
Of course, the higher demand that has pushed up prices is because of the arrival of many foreign businesses in Cyprus, many of which choose Limassol as their base. Regional unrest has benefited Cyprus, which is attracting investors as well as businesses.
“In the midst of regional unrest, Cyprus continues to profit from its stable environment, which is a strong reassurance for investors,” said Misirlis, “Due to its geopolitical stability, Cyprus has become a haven for investors from neighbouring regions looking for safe, strategically positioned assets.”
“This has increased demand in popular coastal and urban areas like Limassol and Nicosia respectively, which foreign buyers frequently choose for luxury real estate.”
In addition to this, Cyprus has become a desirable destination for multinational corporations that are looking for reliable places to carry out their business activities because of its strategic location, EU membership and strong legal system, he said.
“More specifically, Limassol has become popular with multinational corporations, which bring their headquarters or set up regional offices in the city, something that has increased demand for premium residential and commercial real estate and brought in a large number of industry professionals.
“As Limassol develops as a corporate centre with a cosmopolitan lifestyle, foreign interest in the city is only increasing. At the same time, demand for real estate has also picked up due to the relocation of large companies, seeking office space that meets global business requirements and upscale residences for professionals.”
Misirlis pointed out that modern office space facilities report an increasing demand as Cyprus grows as a regional centre for business and investment, especially as a result of the country’s ability to draw in international corporations.
