According to data published by the Central Bank of Cyprus (CBC) on Tuesday, apartment prices in Cyprus increased by 10.8% during the first quarter of 2026 compared to the corresponding period in 2025.
Overall, the Residential Property Price Index recorded an annual increase of 7.5%, with apartment prices rising by 10.8% and house prices by 3.0%, indicating a slight moderation in growth.
Compared to 2010, which serves as the CBC’s base year, apartment prices across Cyprus have increased by 27%, while in Limassol the increase has reached 53%.
The CBC attributes the continued upward trend in the Residential Property Price Index during the first quarter of 2026 primarily to sustained strong demand from foreign buyers, supported to a lesser extent by domestic demand, rising construction costs, and a gradual increase in housing supply.
Compared with the previous quarter, the overall Residential Property Price Index (houses and apartments) increased by 2.3% in the first quarter of 2026, compared with a 2.4% increase in the fourth quarter of 2025. This was driven by an accelerated quarterly rise of 1.5% in house prices and a slower increase of 2.4% in apartment prices.
Regarding annual changes in residential property prices by district, growth accelerated in Nicosia (2.8%) and Larnaca (8.9%), while it moderated in Limassol (9.1%) and Paphos (6.4%). No change was recorded in Famagusta compared with the fourth quarter of 2025.
Property Prices by Housing Type
On an annual basis, apartment prices continued to accelerate, while house price growth slowed.
For houses, growth moderated in Limassol, where the annual increase stood at 2.4%. At the same time, growth accelerated in Larnaca (5.1%) and Paphos (5.2%).
Nicosia recorded an annual increase of 1.8% following consecutive declines, while Famagusta registered an annual decrease of 0.7%.
Apartment prices showed accelerated growth only in Limassol, increasing by 10.7% during the first quarter of 2026. Growth slowed in Larnaca (11.7%), Paphos (6.4%), and Famagusta (1.3%). Nicosia maintained the same annual growth rate as in the previous quarter, at 3.0%.
Property Demand Remains Strong
According to data from the Department of Lands and Surveys, the total number of property sale contracts recorded a significant annual increase during the first quarter of 2026.
Property sale contracts covering all property types increased by 13.8% year-on-year, reaching 4,709 transactions compared with 4,137 during the first quarter of 2025.
This increase was driven primarily by foreign buyers, although demand from domestic purchasers also rose, albeit at a more moderate pace.
Specifically, the number of properties sold to foreign buyers increased by 22.3% year-on-year, reaching 2,044 transactions compared with 1,671 in the first quarter of 2025. Sales to domestic buyers increased by 8.1%, rising to 2,665 transactions from 2,466 during the corresponding period of the previous year.
In terms of transaction volume by district, Limassol recorded the highest number of sales contracts (1,499), followed by Nicosia (1,065), Larnaca (994), Paphos (919), and Famagusta (232).
Domestic buyers accounted for 84% of transactions in Nicosia and approximately 60% in both Limassol and Famagusta. In Larnaca, the proportion of domestic and foreign buyers was broadly balanced, while foreign buyers dominated in Paphos, representing 75% of transactions.
Mortgage Lending Supports Market Activity
According to the CBC, household borrowing for home purchases continued to increase steadily during the first quarter of 2026, maintaining a strong upward trajectory. This trend was supported by the gradual decline in interest rates, which contributed to stronger demand in the property market.
Based on the latest Monetary and Financial Statistics published by the CBC, net new mortgage lending increased by 24.5% year-on-year during the first quarter of 2026, reaching €353.6 million compared with €284.1 million during the corresponding period in 2025.
The weighted average mortgage interest rate declined to 3.15% in March 2026, compared with 3.53% in March 2025, reflecting the gradual easing of monetary policy by the European Central Bank since mid-2024.
Positive lending trends were also reflected in the CBC’s Bank Lending Survey (April 2026), which showed increased net demand for housing loans from households during the first quarter of 2026 compared with the previous quarter, while lending criteria remained unchanged at relatively strict levels.
Banks expect net demand for mortgage loans during the second quarter of 2026 to remain broadly in line with first-quarter levels, while lending standards are expected to become somewhat stricter.
Housing Supply Continues to Expand
According to monthly data from the Statistical Service of Cyprus (CYSTAT), the number of residential units granted building permits—a leading indicator of future construction activity—increased by 79.2% year-on-year during the first two months of 2026, rising from 1,932 units in January–February 2025 to 3,463 units during the same period in 2026.
As a result, the CBC expects the gradual increase in housing supply to continue over the medium term.
Data from the European Commission’s Business and Consumer Surveys (March 2026) indicate that the construction activity indicator remained positive during the first quarter of 2026 for the tenth consecutive quarter (3.2 points), supporting expectations of continued growth in housing supply.
The CYSTAT Construction Materials Price Index recorded a marginal annual increase of 0.9% during the first quarter of 2026. However, construction costs remain at historically elevated levels, partly due to geopolitical developments that have continued to disrupt global supply chains.
The European Commission’s expectations indicator for property prices over the next three months rose to 32.8 in the first quarter of 2026, compared with 24.6 during the same period of the previous year. According to the CBC, this suggests that a larger proportion of market participants expect property prices in Cyprus to continue increasing in the near term.
Furthermore, according to the same survey, persistent labour shortages in the construction sector continue to exert upward pressure on property prices. The CBC notes that these labour shortages are also reflected in wage increases within the sector, which have remained significantly above pre-pandemic levels in recent quarters.
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