Strong domestic property demand has supported the Cypriot housing market, leading to robust increases in property prices and rental yields across the country. Additionally, foreign property investors are returning to Cyprus to enjoy capital appreciation opportunities, as well as an attractive quality of life for those looking to relocate, with access to numerous blue flag beaches.

House and apartment prices in some parts of Cyprus performed incredibly strongly early in 2022. Areas like Paphos saw apartment prices rise by 10.4%, while apartment prices in Famagusta increased by 8.4%. Demand for property has also begun to recover since the COVID-19 pandemic – countrywide sales surged by 42.3% y-o-y to 5,090 units in the first five months of 2022.

Despite this, the disparity between nominal house prices and real house price figures is notable. This suggests that while yields have increased, the Cypriot housing market has suffered from the impact of high inflation figures. During 2022, the difference between nominal and real house prices stretched to nearly 10%. This reflects sharp inflationary pressures the country has experienced.

  • House prices in Cyprus have resurged along with demand during 2022.
  • Inflation has hit the country's housing market, reaching 8.7% as of November 2022.
  • Foreign investors have gradually begun returning to property investment in Cyprus.

Although a steady flow of tourist activity also continues to support the country's economy – albeit failing to reach the highs seen pre-COVID-19 – construction activity for new residential dwellings has significantly slowed. In the first five months of 2022, tourist arrivals totalled 849,058 people, which remains substantially below the record 1,121,361 tourists recorded in Jan-May 2019.

The rental laws in Cyprus are decidedly pro-tenant. In particular, tenants covered by the Rent Control Law (1983) have generous terms afforded to them. Indeed, where 'statutory tenants' are concerned, they are protected by the Rent Control Law and as a result it takes an average of 360 days to evict a tenant. Investors hoping to enter the buy-to-let market should be aware of this.

2. Limassol

The largest transit port in the Mediterranean, Limassol is the second largest urban area in Cyprus after the capital city of Nicosia. As a result, Limassol is a popular tourist destination, with villas and apartment blocks lining the beachfront. Shops, pubs, nightclubs and restaurants are also common, serving as popular attractions for holidaymakers and residents.

Limassol supports the robust housing market in Cyprus, with its own track record of resilient property prices. During the year to Q1 2022, Limassol apartment prices rose by 6.9%, and house prices increased by 2.1%. The average price of an apartment is between the range of EUR 4,000 to EUR 5,000, generating a rental yield of 3.88%.

3. Paphos

The historic and scenic city of Paphos is situated on the southwest coast of Cyprus. Famed for being the birthplace of the Greek Goddess, Aphrodite, Paphos attracts a steady stream of tourists hoping to learn more about ancient mythology. Alongside historical points of interest, Paphos features pristine beaches, UNESCO heritage sites and a wealth of local cuisine.

Paphos has also experienced strong apartment price increases. During the year to Q1 2022, Paphos apartment prices rose by 10.4% – far higher than any of the other districts in Cyprus. House prices in Paphos only increased at a more subdued 4%, however this is still higher than some other parts of Cyprus.

4. Nicosia

As the capital city of Cyprus, Nicosia is also where the nation's cultural landmarks can be found. That being said, the city is also divided into two equally distinctive regions – the northern Turkish section and the southern Greek community. The Turkish section is not part of the EU. Underlying division may put off foreign property investors, who dislike the uncertainty which that may bring.

However, low effective rental income tax and rapid growth as a result of EU membership have made Nicosia – and Cyprus more generally – more attractive investment opportunities for housing speculators. Despite house prices in Nicosia falling by 0.2%, apartment prices rose by a modest 3.4% during the year to Q1 2022.


One of the more notable benefits of investing in property in Cyprus – particularly in the buy-to-let market – is that rental income tax is low to moderate. Rental income which surpasses €19,500 is taxed at progressive rates. Additional benefits include standard taxation perks, with income-generating expenses being deductible from gross income.

Other taxation benefits include Capital Gains tax – taxation on the gain made from sales of immovable property assets at 20% – where owners can qualify for a lifetime exemption of 85,430 euros. This is only allowed where the owner has occupied the premises for at least 5 years. In Cyprus there are no taxes on inheritance or estate duties.