Low savings rates fail to keep pace with soaring Cyprus home prices

A homebuyer in Cyprus would need to hand over every cent of the country’s average salary for almost two years simply to raise a standard deposit. For the typical worker, the wait would be considerably longer. 

A new analysis by BestBrokers estimates that an average-sized home of 108 square metres costs €305,296 in Cyprus. A buyer providing 20 per cent would therefore need €61,059 before taking out a mortgage for the remaining amount. 

With average gross monthly income estimated at €2,603, the deposit is equal to 23 months of pay. The calculation assumes, however, that the buyer saves their full salary before tax and spends nothing on rent, food, electricity, transport and other household costs. 

The income estimate is almost identical to the latest wage data, which placed average gross earnings at €2,601 during the first quarter of 2026. However, the average is pulled upwards by higher earners and does not reflect what most workers receive. 

Cyprus’ median monthly salary stood at €1,968 in 2025, while one in three employees earned below €1,500 during the first quarter of this year. On the median salary, the same deposit would consume 31 months of gross pay. For someone earning €1,500, it would represent more than 40 months. 

Because no household can save its entire gross income, the real period is much longer. A worker earning the median salary and saving 20 per cent each month would need almost 13 years to reach €61,059, provided property prices did not increase during that time. 

The 20 per cent assumption also closely reflects conditions in the local mortgage market. Bank of Cyprus currently offers financing of up to 80 per cent through its first-home loan, leaving the buyer to cover the remaining fifth. 

At the price used in the study, the mortgage would amount to about €244,237. Based on June’s average new mortgage rate of 3.28 per cent, a 30-year loan would carry a monthly repayment of approximately €1,067 if the rate remained unchanged. That would absorb more than half of the median gross salary before tax and other living costs were deducted. 

Actual new-build sales show that the study’s estimate is not far from current market levels. The average transaction reached €319,618 during the first half of 2026, while the median stood at €232,500. 

However, the amount required changes sharply between districts. Based on median new-build prices, a 20 per cent deposit would reach about €37,000 in Nicosia and €38,000 in Larnaca. It would increase to €45,000 in Famagusta, €60,600 in Limassol and €72,000 in Paphos. 

Property type makes another significant difference. The median new apartment sold for €215,000, requiring a deposit of about €43,000, while the median price of a new house reached €365,000, lifting the initial contribution to €73,000. 

For first-time buyers looking towards apartments, the target is also moving particularly quickly. Central Bank of Cyprus’ figures showed that apartment prices rose by 10.8 per cent year-on-year during the first quarter of 2026, compared with 3 per cent for houses. 

At the same time, money set aside for a deposit is growing much more slowly. Average household savings rates stood at 1.42 per cent in June, leaving savers earning little more than 1 per cent while apartment prices climbed at a double-digit pace. 

Demand for assistance has consequently been strong. A government housing scheme offering grants of up to €50,000 to people aged 41 and below initially provided support for 400 beneficiaries but attracted 1,018 applications. A further €11 million was later approved to cover another 277 applicants. 

In the wider European comparison, Cyprus remains ahead of the UK, Malta and Spain, where a 20 per cent deposit represented 24 months of gross income. The figure reached 29 months in Greece and 30 in Portugal, while Ireland required 13 months, Norway 16 and Belgium 17. 

Cyprus and Croatia recorded Europe’s lowest housing-cost overburden rate, with 2.6 per cent of urban residents spending at least 40 per cent of their disposable income on housing, the latest Eurostat data showed. Greece recorded the highest rate at 26.9 per cent, followed by Denmark at 25.3 per cent.