A new index created by WiRE FS shows that the prices of Cyprus property, across most categories, fell in the first quarter of 2021. Rents also recorded a drop in most categories.
Apartment prices fell by 0.5 per cent in Q1 2021, compared with Q1 2020, house prices by 1.5 per cent, commercial properties (retail) by 5.3 per cent, warehouses by 4.5 per cent, offices spaces by 1.0 per cent, holiday apartments by 1.2 per cent and holiday houses by 3.2 per cent.
Following the same trend as the corresponding months of 2020, the first months of 2021 were greatly affected by the coronavirus pandemic and the relevant restrictions, recording a drop in the prices across all property categories.
“The substantial drop observed in warehouse prices is likely to be temporary, since there has been a recent increase in demand from companies engaged in logistics, as well as other companies that have expanded their online sales channels,” Pavlos Loizou, managing director of WiRE FS explains. “We also expect the prices for holiday properties to recover soon; as the pandemic comes under control, demand for these properties will progressively increase from foreign buyers who find it difficult to visit the island now,” he says.
“It seems that it will be more difficult for the prices of commercial properties (retail) to return back to positive levels. The market needs more time to recover as consumers are going through a period of redefining their purchasing priorities, lifestyle and the way they shop,” Loizou adds.
For rentals, on an annual basis, prices dropped for apartments (-0.6 per cent), commercial shops (-6.4 per cent), offices (-3.2 per cent) and holiday houses (-5.4 per cent). In contrast, there was a slight increase in the rental prices for houses (2.6 per cent), warehouses (0.7 per cent) and holiday apartments (0.1 per cent).
“The findings are expected due to the conditions of financial instability. The slight increase in house rentals is probably caused by the fact that tenants, after a year of restrictions, are more willing to rent houses with outdoor space rather than apartments. It is noted, though, that it is difficult to foresee the full effects of the pandemic, since only a relatively short period of time has passed,” Loizou explains.
The WiRE Index will be published on a quarterly basis on the website https://www.wire-fs.com/wire-index/.