Property values in Cyprus marked an increase during the first quarter of 2024, compared to the same period during the previous year, according to a report released on Friday by real estate analytics firm Ask Wire.

Ask Wire CEO Pavlos Loizou said that “geopolitical tensions and unrest in the region continue to influence overseas real estate demand, accelerating the pace at which prices are affected“.

“Additionally, high mortgage rates are likely to persist, diminishing locals’ buying power and stabilising market prices as demand adjusts,” he added.

According to the report, apartments saw a rise of 6.3 per cent, while houses experienced a more modest increase of 2.1 per cent.

Offices and holiday apartments also showed positive growth, with prices rising by 3.0 per cent and 3.6 per cent respectively.

Retail property prices remained relatively stable with a slight increase of 0.4 per cent, while holiday houses saw a small uptick of 1.0 per cent.

Warehouse prices, however, remained unchanged over the year. Limassol emerged as the district with the highest percentage increase in prices for both apartments and houses.

On a quarterly basis, the index reports more modest changes, with apartment prices increasing by 0.8 per cent, and houses by 0.4 per cent.

Offices and holiday apartments also saw small increases of 0.2 per cent and 0.5 per cent respectively. Prices for retail properties, warehouses, and holiday houses remained stable during this period.

The rental market displayed even more robust annual growth. Rental values for apartments surged by 9.3 per cent, and houses by 6.4 per cent.

Retail rentals grew by 4.2 per cent, while offices saw an 8.2 per cent increase. Holiday apartments and holiday houses also experienced rental growth, with increases of 5.9 per cent and 3.4 per cent respectively.

The only category to see a decline was warehouses, with a slight decrease of 0.6 per cent.

Quarterly changes in rental values were minimal compared to the annual data. Only apartment rentals showed a slight increase of 0.9 per cent, with all other property types maintaining stable rental values over the quarter.

“Moving into the second quarter of 2024 and beyond, we expect property prices for opportunistic investments to decelerate,” Loizou explained.

“This combination of high interest rates, increasing construction costs, and regional unrest could significantly impact the market’s stability and influence investment decisions in the long run,” he concluded.