Investing in Property in Cyprus: An Overview
Cyprus, the third-largest island in the Mediterranean, has emerged as a highly attractive destination for property investment. Several factors contribute to its appeal, including its strategic location, favourable tax regime, vibrant tourism industry, and high quality of life. Here’s an in-depth look at why buying property in Cyprus can be considered one of the best investments you can make.
Strategic Location and Connectivity
Cyprus’s strategic location at the crossroads of Europe, Asia, and Africa makes it a significant hub for business and travel. The country has excellent connectivity with major cities in Europe and the Middle East through two international airports in Larnaca and Paphos. This accessibility not only boosts tourism but also makes it convenient for business and investment activities.
Favourable Tax Regime
Cyprus offers one of the most attractive tax regimes in Europe. The corporate tax rate is just 12.5%, among
the lowest in the EU. There are also significant tax benefits for individuals, including exemptions on capital gains tax for properties purchased by non-residents. The country has double tax treaties with many nations, further enhancing its appeal to foreign investors.
Robust Legal Framework
The legal framework in Cyprus, based on English Common Law, provides a high level of protection for property buyers. The process of buying property is transparent and straightforward, with clear title deeds and a reliable land registry system. This reduces the risks associated with property investment and ensures that investors can have confidence in the security of their investments.
Growing Tourism Industry
Tourism is a major driver of the Cypriot economy, with millions of visitors flocking to the island each year to enjoy its stunning beaches, rich history, and favourable climate. This robust tourism industry creates a strong demand for rental properties, providing a steady income stream for property investors. Popular tourist destinations like Limassol, Paphos, and Ayia Napa offer excellent opportunities for holiday rentals.
High Quality of Life
Cyprus boasts a high quality of life with a pleasant Mediterranean climate, beautiful landscapes, and a safe, friendly environment. The cost of living is relatively low compared to other European countries, making it an attractive destination for retirees and expatriates. Excellent healthcare facilities, modern infrastructure, and a high standard of education further enhance the quality of life, making it an appealing place to live and invest in.
Citizenship by Investment Program
Cyprus offers a citizenship-by-investment program, which allows investors to obtain Cypriot citizenship by investing in real estate. This program provides several benefits, including visa-free travel to over 170 countries, the right to live and work anywhere in the EU, and access to high-quality education and healthcare. This makes the property investment in Cyprus even more attractive to international buyers.
Economic Stability and Growth
Cyprus has demonstrated strong economic resilience and growth, recovering robustly from the financial crisis of 2013. The government has implemented reforms to enhance the business environment, attract foreign investment, and diversify the economy. The real estate market has benefited from these positive economic trends, with property values showing a steady increase over recent years.
Interest Rates on Deposits Very Low
The interest rates on deposits are very low level: 1.29% for individuals. In turn, the Cyprus Stock Exchange also offers a low yield of about 2% per annum, and government bonds are not the most profitable option.
Investing in housing in Cyprus even if you take into account the constant rise in prices, remains the most popular and safest way to save money and for your information, the demand for real estate in Cyprus remains stable, especially for secondary apartments and houses.
What makes the popularity of real estate investment in Cyprus is the volume of residential transactions, which in the year 2022 reached the mark of 6 million Euros and most investors invest in apartments in the island. The total sales of apartments in 2022 are a lot higher than in previous years by almost 3000 sales, with more than 80% coming from local buyers, about 13% for EU citizens and 7% from third-country nationals.
A recent report released by the Land Registry states that the war in Ukraine did not have a significant impact on real estate values in 2022, while sales contracts increased by about 30%. On top of the list with 7% profitability to the owners of the apartments is Limassol then Paphos with 5,5% and the capital Nicosia stands at 5% and Larnaca and the free areas of Famagusta you can have profits from 4% and 4.4% respectively.
The holiday apartments came in second with the yield in Limassol is 6.7%, in Paphos – 4.8%, in Larnaca – 4.7%, in the free areas of Famagusta – 5% and in third place with the yield in Limassol is 5.9%, in Paphos – 6.3%, in Nicosia – 5.8%, Larnaca – 6.3%, in the free areas of Famaguta – 4.3%.
If you want to invest in real estate in Cyprus and see your money grow, is advisable to contact one of the best companies that specialize in profitable real estate. They will do all the work for you with no hustle and strain yourself and give you the keys in hand for you to move in straight away or rent it if you take that root.
Conclusion
Investing in property in Cyprus offers numerous advantages, from a strategic location and favourable tax regime to a high quality of life and robust legal protections. The thriving tourism industry, combined with the benefits of the citizenship by investment program, further enhances its appeal. With a stable and growing economy, Cyprus presents a compelling case for property investment, making it one of the best choices for investors looking to diversify their portfolios and secure long-term returns.
Buying a property in Cyprus is still the most profitable investment. This is because for the local residents is one way where they could invest money.
