By Stelios Orphanides
Prices for flats and houses in Cyprus fell in October to December 0.5 per cent and 0.1 per cent respectively compared to the previous quarter, undeterred by a rise in home rent values, the Royal Institute of Chartered Surveyors in Cyprus said.
“Certain Districts and asset classes indicate signs of stability, as Paphos, Larnaca and Famagusta are progressively bottoming out,” RICS said in an emailed statement on Thursday.
Limassol saw flat prices drop a quarterly 1.4 per cent in the last three months of 2015 while in Nicosia, where house prices fell 0.8 per cent, office prices went cent up 2.9 per, RICS said.
On average across Cyprus, values for warehouses fell 2.3 per cent in the fourth quarter while shops remained unchanged as office prices rose 0.7 per cent, RICS said.
In the last quarter of 2015, flat prices in Cyprus fell 1.8 per cent compared to the respective quarter of 2014, while houses fell 0.3 per cent, RICS said. Prices for retail shops, offices and warehouses fell an annual 2.4 per cent, 0.9 per cent and 2.2 per cent in October to December.
Rental values rose a quarterly 0.5 per cent for apartments and 1.1 per cent for houses, RICS said. In the same quarter, office rent rose 0.2 per cent, while shops and warehouses fell 0.2 per cent and 1 per cent respectively.
Apartment and house rent rose in October to December an annual 0.3 per cent and 0.8 per cent respectively, RICS said. Owners of retail space, warehouses and offices received 3.8 per cent, 2.6 per cent and 0.2 per cent less rent for their respective property in the last quarter of last year.
“The majority of asset classes and geographical areas continue to be affected, with districts that dropped the most early on in the property cycle now nearing or showing some signs of price stability,” RICS said.
Real property investors got the highest returns by investing in retail properties, according to RICS. The initial yield from shop investment was on average 5.2 per cent across the island, followed by offices with 4.5 per cent and warehouses with 4.3 per cent. Houses offered the lowest return with 2 per cent followed by apartments with 3.9 per cent.
“The parallel reduction in capital values and rents is keeping investment yields relatively stable and at low levels, compared to yields overseas,” RICS added. “This suggests that there is still room for some re-pricing of capital values to take place, especially for properties in secondary locations”.