Cyprus: fall in property sales slowing

The overall rate of decline in property sales in Cyprus is at its lowest in recent months, with sales in Paphos and Larnaca increasing, according to a report by Cyprus Property News.

Land Registry figures released last week showed that a total of 444 contracts were signed in November, down from 485 compared to the same period last year – a yearly decline of only 8%; the lowest in several months.

The increase in property sales in Paphos and Larnaca, compared to November 2011, helped to secure this figure.

Paphos saw an increase of 42% in sales, with 165 properties sold last month, in contrast to 116 a year ago.

Property valuer Polys Kourousides pointed to the interest from Chinese buyers in the city.
He said to StockWatch “Paphos is their first choice - in the past few months they bought properties of ?150 -160 million.”

Sales in Larnaca were also up by 10% from 62 to 68 in the year - Mr Kourousides noted that Larnaca was the second choice for the Chinese, with Egyptians also interested.

Despite the rise in these cities, the rest of Cyprus saw declines - sales in Famagusta, Limassol and Nicosia fell by 38%, 35% and 21% respectively.

The first 11 months of the year have seen a total of 5,774 contracts deposited, compared to 6,387 through the same period last year – a decline of over 9%.

OPP spoke to Jennifer Sharpe, Executive Director of real estate agency G & P Lazarou, who pointed to the unrest of the economy as one of the main factors causing the drop in sales.
“The tightening of available credit both for residential and commercial purposes, the increased unemployment rate and the local economic and political insecurity had a dramatic effect on the locals, who had a sudden drop in property transactions,” she said.

She went on to explain that Paphos has been hit the hardest, with prices falling 30-40% from their peak in 2008, and noted that the city has a large stock surplus due to overbuilding.
She pointed to the example of a developer in Paphos, who was “selling new two-bedroom apartments at the construction cost, literally giving the land for free and simply recouping his costs.”

“Larnaca has also had a drop in the relevant property values and remains an appealing choice for overseas buyers compared to Nicosia and Limassol,” Ms Sharpe said.

She concludes that Nicosia and Limassol both remain expensive in comparison to Paphos and Larnaca.

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