Government spokesman Konstantinos Letymbiotis on Monday called for house prices to fall.

He pointed out that Cyprus has seen the third-lowest rate of house price increases in the European Union since 2015, with average house prices on the island having risen by 10.3 per cent in the last nine years.

However, he said, “that upward trend must be reversed” to “maintain the high rate of home ownership seen in recent decades and bolster access to affordable housing”.

With this in mind, he said the government is implementing “measures and plans” costing more than €80 million, which “focus on increasing the housing stock and, at the same time, achieving affordable housing”.

These measures and plans include the “renovate-rent” plan and a separate fund which provides financial assistance to young people and couples aged 41 and younger who wish to buy homes.

The scheme offers a one-time grant ranging from €20,000 to €50,000 to a total of 400 eligible recipients, based on a number of criteria including income and the number of people in applicants’ families.

The renovate-rent scheme sees homeowners receive grants ranging between €15,000 and €35,000 to renovate the properties they own, allowing them to be rented out at 30 per cent below the going market rate for four years thereafter.

Interior Minister Constantinos Ioannou had said he hopes the grant for young people will “strengthen young people’s and young couples’ purchasing power for them to be able to buy a first home”.

In October, he had also touched on the matter of a new streamlined process through which district governments can issue planning permission for developments of up to two houses.