The Peculiarities Of The Cyprus Property Market

No matter how many studies one carries out, no matter how knowledgeable one is and no matter how experienced one can be in property matters, not always is one able to predict correctly and, or even to analyze with certain clarity, in some cases, the property market performance in Cyprus.

The development boom in Voroklini village in Larnaca is surely an example for a study for the future. This village, (situated eastwards of Larnaca about 5-7km away and 3-4km away from the seafront, Dhekelia Road) with 3000 residents, all of a sudden, during the year 2002 and up to now, it has become a location of keen interest amongst foreigners.

The development of this village, which before 2002 involved 20 building units per year, has reached today 400-600 units at a time. The residents of the village have suddenly tripled, resulting in the proportionate shortages of infrastructure projects etc that are always caused by a development boom.

However, how could anyone expect such a development when:

The strange thing about it is that the area of Kiti (Meneou-Pervolia) that is similar presents a slow-moving market in relation to the Voroklini area. This area, westwards of Larnaca, offers almost the same prices for projects, although these are on the beach, provides a relaxing environment, secluded development, Pervolia village has been fairly upgraded, as far as restoration is concerned, this village is very close to Larnaca town and there is better building quality. So, where is the logic as far as the demand among foreigners is concerned? (as the demand amongst Cypriots is limited in the Voroklini area, while the main demand is in Meneou-Pervolia area).

This great demand for areas eastwards of Larnaca is constant and since Voroklini village has been almost 'sold out, the interest is now turning towards the nearby Pyla village. The area south of Pyla (up to the motorway), which has remained underdeveloped (due to the proximity to the green line and the mine fields), has suddenly become the location of interest among property developers and the existing prices at £25.000/donum, have within six months increased to £35,000/donum and now are at £45.000-55.000/donum, at a rapidly increasing rate. Surely these prices, taking into account all factors, should be considered as the lowest ones within the free areas of Cyprus and in view of the present situation there are prospects of rapid increase.

Twelve months ago we referred to the high prices in Paphos i. e. apartment-selling prices at £1000/sqm and houses around £1500/sqm. This high cost has caused interest to turn, quite noticeably, towards the cheaper areas of Cyprus, Larnaca and subsequently Famagusta (Paralimni-Sotira), while Limassol has steadily fluctuated at medium levels.

However, since Voroklini/lMeneou prices, as they are today, have reached levels similar to Paphos, we should think carefully as to which area is going to be the next one to attract foreign interest, having in mind also other development areas, i.e. Alethrico area, Zygi-Mazotos area etc, where prices are much lower.

So, be careful of the sensitive foreign buyers market, where prices are a decisive factor (particularly the painful experiences regarding the prices in the North).