Property investment in Larnaca is booming and it is not surprising that investors are highly interested in the city given the variety of properties available for investment and large-scale development projects that are promising to modernize the city.
Its Mediterranean climate and stress-free lifestyle, low crime rate, and most importantly, the government’s appealing tax regime, together with the non-dom status program and the low starting costs for business registration are all very appealing incentives to foreign investors and digital nomads to start real estate investing in Cyprus.
Larnaca is not only a port city, but it is also home to the island’s largest international airport and its coastal location provides opportunities to invest in modern inner-city apartments as well as in lavish seaside villas, but also in well-developed maritime, financial, and foreign commerce industries.
Here is why more and more investors are choosing to invest in Larnaca.
High-value development projects
As a market that has become favorable to a large Israeli community of investors, with lower investment costs and more affordable land compared to bigger cities like Nicosia and Limassol, Larnaca is now welcoming numerous high-value development projects and is likely to be the new driver for the real estate sector in Cyprus for the years to come.
Major projects including the already completed Metropolis Mall and the New Municipal Market, as well as the steady progress of Larnaca’s New Marina and Port redevelopment, are having a positive effect on the real estate market.
The upgrade of the Larnaca-Dhekelia coastal road and the relocation of the oil refineries freeing up 3 kilometers of the seafront will greatly improve the image of the city.
The new Larnaca Marina and port redevelopment
Larnaca’s New Marina and Port redevelopment, worth €1.2 billion, is the most significant investment project in Cyprus that aims to modernize Larnaca and boost tourism, create new jobs, and bring in additional investment opportunities.
The expansion of the marina will have a different profitability potential for investors by providing a thriving landscape of mixed-used properties. With international retailers, luxurious villas and hotels, residential tower buildings, exquisite restaurants, and cafes, offering high-end cruise and marina facilities while being environmentally friendly and sustainable, the New Larnaca Marina will be an investor’s Wonderland.
Iconic buildings on the rise
Tower buildings and opulent hotels including the QN Kition Tower and the Apollo and Poseidon towers of the NAOC complex, the Staston Project consisting of two residential towers and a hotel on Makarios Avenue, the Radisson Beach Resort Larnaca on Dekelia road, and the commercial Ion Tower in Drosia – a newly emerging central business district of Larnaca – are just a few of the upcoming developments that will put Larnaca under a new spotlight for investments.
Consistent growth in the Real Estate Market
Larnaca’s real estate market has grown significantly, and in comparison to other districts, the apartment sale values increased for the fourth consecutive quarter in 2022.
The total sales value in real estate for 2022 in Larnaca reached €682 million from 4,243 transactions, according to the latest data offered by the Department of Lands and Surveys (DLS).
The rental market has also registered a rise in value mainly due to population increase. Arrivals from Ukraine, Russia, Belarus, and other countries, and companies choosing to relocate their operations to Cyprus, have increased the demand for housing and caused a spike in residential and holiday rentals and prices. Lastly, the influx of foreign investors, especially from Israel and Lebanon increased the prices of apartments and villas in the Larnaca market.
With Cyprus’s economy remaining strong, a low supply and high demand for housing mean that it is unlikely for residential prices to drop any time soon.
Statistically speaking, summing up 2022, Larnaca experienced a 23.4% increase in real estate transactions compared to the previous year (3,437 properties sold in 2021). These transactions were mainly driven by the house and apartment segments and their total value also registered an increase of 30.4% compared to 2021 (€523 million).
The rental values of apartments increased by 10.9% and houses by 9.1%. For holiday apartments the values raised 8.0%, and 6.7% for holiday houses.
The high demand from both domestic and foreign buyers is relatively strong and the elevated construction costs will continue to push house prices upwards in the near future.
Larnaca provides many opportunities for investing in real estate and gaining a passive income whether you are considering investing in modern apartments in the city center or seafront luxury villas on the outskirts of the city.
According to real estate experts, given how rapidly the city is developing, Larnaca is set to experience explosive growth over the next years, and now is the time to invest in the city’s real estate market before a high rise in prices occurs.