The cost of buying houses and apartments has become a huge issue in recent years as is well-known. There is certainly also a problem in the level of residential rents, because rents and values have increased in the last two years by around 20 per cent in cities.

This is due to inadequate construction of new units and because of the shortage caused by short-term lets with very high rents, as well as the increased number of students adding to the demand in areas close to the various colleges. All this with private sector salaries remaining at the same levels (especially for the lower paid) is causing a problem.

Looking at the issue of rents in particular, the problem will continue to grow. I have some proposals that could help alleviate the problem.

Within and/or in the periphery of cities for residential development the building coefficient could be increased by 30-40 per cent on land with an area of over 2,000 sqm and for units that will be let out for a period of at least 10 years with relevant evidence. These units can be made available through purchase to third parties, provided that these buyers have the same obligation to rent.

From the first day that some ‘wise’ urban planning people proposed that there be a minimum area in 1990 dependent on the number of bedrooms, the cost of construction increased. The abolition of this restriction or reduction of minimum areas will lead to an increase in units and a reduction in costs.

At the same time apartments for rent for a decade should not require a parking space per apartment, but one space per two. This proposal will reduce construction costs and consequently rents. This measure will be suitable for rentals to students.

There are plans for low cost units.What is this? Will we import prefabricated wooden units or else and will the land development agency take them over and participate? We can see today the result of the post-war settlements, which add to the run-down neighbourhoods and the social classification of citizens.

The housing finance corporation and the land development agency, being state-owned, cannot cope with this measure and do not have the appropriate land to construct the developments. The construction of 50-100 units a year throughout Cyprus would not solve the problem.

Regardless, it would take two to three years, of waiting for permits and execution, for this, at a time when rents are expected to increase.  Therefore, and as a temporary measure for a period of five years and for areas within cities, apartments for rent should be entitled to a tax reduction, to encourage existing owners to rent.

A large percentage of landlords withdraw their units for rent, due to the dangers of renting, such as defaulters being encouraged by lengthy court proceedings not to pay, thus increasing the problem. 

It is difficult to overcome this problem. Perhaps, a starting point for discussion could be the proposal for immediate eviction with summary procedures in court, with a waiting period of no more than three months. It is currently around six to twelve months minimum.

There is also the proposal of subsidies, but this measure will burden the state with additional funds in the millions and be subject to the various tricks that usually accompany them.  That is not the solution.

We need the immediate implementation of the proposal for the taxation of short-term lets. The implementation of this measure also needs the contribution of local authorities.

Colleges and universities should consider renting directly from the owners and renting them to students.  An investor will require a lower rent if they rent out a number of units and would get a secure sum rather than chasing each student separately to pay.  These institutions would be burdened at their own cost, but at the same time solve the housing issue of their own students.

Everything else is just talk in order to keep the public ears happy.

Antonis Loizou & Associates EPE – Real Estate Appraisers & Development Project Managers,, [email protected]