Published on and written by Cyril Jarnias
Cyprus’ real estate market enters 2026 in a phase rarely this interesting for investors: prices have risen sharply since 2019, activity remains strong, but price increases are starting to moderate. In other words, the market is moving out of euphoria and into a healthier dynamic, driven by a solid economy, receding interest rates, and unwavering rental demand.
Cyprus offers several advantages for rental investment: attractive taxation, a legal framework based on British law, its membership in the EU and the Eurozone, annual tourist numbers exceeding 4 million visitors, and rental yields generally higher than those in other Mediterranean countries. These assets apply equally to buying an apartment for expatriates, a villa for seasonal rental, or acquiring a new property to obtain a residence permit.
The key is to understand the precise state of the market, what can be reasonably expected for 2026, and above all, where it is most relevant to invest based on one’s profile. That’s what we detail here, based on the latest data from Cypriot banks, institutes, and industry players.
A Market Stabilizing Rather Than Overheating
The figures show a very dynamic market over the past five years, which is now entering a phase of more measured growth. Between 2020 and 2025, residential prices increased by an average of 5 to 8% per year, peaking at nearly 7.8% annual increase in the Residential Property Price Index (RPPI) in early 2024. In parallel, the volume of transactions reached 5.71 billion euros in 2024, with 67% being residential properties.
The year 2024, however, marks a turning point: price growth remains clear (+5.6% approximately), but the acceleration is slowing down. The RPPI, which was still growing at over 7% annually in early 2024, was increasing “only” 6.51% year-on-year in the third quarter, with an 8.8% increase for apartments and 6% for houses. In 2025, the annual increase fluctuated between 1.95% and 4.8% depending on the quarter, below the EU average.
Number of sale contracts deposited between January and September 2025, up 13% year-on-year.
The key takeaway for an investor is that the market is not considered to be in a “bubble” and that the fundamentals remain solid: inflation under 2.2%, GDP growth around 3%, low unemployment, record tourist flows, and above all, a constant influx of expatriates, retirees, and foreign remote workers boosting rental demand.
2026 Forecasts Point Upwards, But More Reasonably
Projections converge: in 2026, prices are expected to continue rising, but at a healthier pace. Most credible scenarios suggest an average increase of 3 to 7% across the island, with a range of 5 to 8% often cited as the central scenario. The most sought-after areas and new seaside developments could even still see increases close to 10%.
Paphos is the Cypriot city with the highest anticipated property growth, potentially reaching up to 12%.
This relative slowdown in price growth is partly linked to a slight decline in foreign purchases in 2024 (-10% of non-resident transactions), after they literally fueled the market in 2022-2023. It’s also related to the arrival of new developments on the market, which slightly ease supply pressure, without creating an excess: the shortage of quality properties in sought-after areas remains a recurring theme.
Why Cyprus Attracts So Many Foreign Investors
Several structural factors explain the market’s resilience and its appeal to international capital, particularly looking ahead to 2026.
The first lies in the rare combination of a rather healthy macroeconomic environment (GDP growth between 2.5 and 3.7%, falling public debt, political stability), a favorable tax system (no wealth or inheritance tax, reduced taxation on capital income, corporate tax at 12.5%), and a reassuring legal framework based on British law, with well-defined property rights.
Cyprus, a member of the European Union and the Eurozone, offers investors a secure euro-denominated asset and facilitated access to the European market. Accession to the Schengen Area is planned for 2026. The country also benefits from a very sunny Mediterranean climate, with over 300 days of sunshine per year, making it an attractive destination.
The third lever is the possibility of obtaining permanent residency through investment. A purchase of at least €300,000 (excluding VAT) in a new property grants access to a permanent residence permit, provided you can prove at least €50,000 in annual income from abroad, increased for a spouse and children. This Cypriot “golden visa,” more accessible than some neighboring schemes, fuels sustained demand in the new development segment, especially in coastal cities.
The region welcomes over 4 million annual visitors, with an extended tourist season from March to November. This demand is reinforced by strong growth in expatriates, digital nomads, and students attracted by English-speaking universities. These factors create a structural rental demand, supporting rents for both long-term and seasonal rentals.
Key Figures: How Much Does a Property in Cyprus Cost Today?
Prices remain very disparate depending on the city, neighborhood, and type of property. Nevertheless, we can outline a panorama based on 2024-2025 data.
Overview of Median Prices and per Square Meter
| Property Type / Indicator | Approximate Median Price | Median Price per m² |
|---|---|---|
| Apartment (All Cyprus) | €478,000–510,000 | €4,000–4,050/m² |
| House / Villa (All Cyprus) | €725,000–850,000 | €3,350–3,770/m² |
| Average “Standard” Apt. (Excl. Premium) | ≈ €250,000 | €2,500–2,600/m² |
| Average “Standard” House / Villa | ≈ €320,000 | €2,500–2,600/m² |
These high medians reflect the weight of high-end transactions in flagship destinations like Limassol and Paphos. In practice, the entry point for a private investor is rather around €150,000 for a small apartment, particularly in some neighborhoods of Larnaca or Nicosia.
Seafront properties in Limassol, especially spacious apartments in modern residences, have starting prices around €700,000, and very high-end penthouses can reach several million euros.
Significant Price Gaps Between Districts
The price map by district confirms a clear contrast between the two coastal “premium” hubs and the rest of the island.
| District | Median House/Apt. Price | Synthetic Comment |
|---|---|---|
| Limassol | ≈ €660,000–710,000 | Most expensive market, very high-end oriented |
| Paphos | ≈ €574,000–600,000 | Strong tourist and retiree demand |
| Famagusta | ≈ €419,000–455,000 | Highly seasonal, dependent on summer tourism |
| Nicosia | ≈ €300,000–350,000 | Inland capital, oriented toward local demand |
| Larnaca | ≈ €297,000–307,000 | Most affordable district among major markets |
Within districts, prices per square meter also vary greatly. Limassol can show an average of €3,500 to €5,000/m², or even more than €6,000–€8,000/m² for some frontline sea projects. Paphos is more in the €2,000 to €3,500/m² range, while Larnaca navigates around €2,200–€3,000/m², with peaks up to €4,000/m² for new seafront developments. Nicosia remains generally lower, with apartments between €1,800 and €2,500/m², and more peripheral areas even cheaper.
Rental Yields: 2026 Looks Promising for Landlords
The Cypriot rental market is undergoing a transformation. After a period of very rapid rent growth in 2022–2023, the increase has calmed significantly in 2024, but levels remain high, especially in major cities. For a landlord, the challenge is no longer soaring rents but the ability to maintain a good occupancy rate, which remains the case in most attractive areas.
Indices published by RICS and other players point to an average gross yield of 4 to 6% for most residential properties, with higher peaks in certain niches.
Average Yields by Property Type and Area
| Segment / Location | Typical Gross Yield |
|---|---|
| Apartments (National Average) | ≈ 5–5.5% |
| Houses / Villas (National Average) | ≈ 3–3.5% |
| Apartments in Limassol | ≈ 5–7%, sometimes 7.8% on small units |
| Apartments in Paphos | ≈ 5–6% (classical rentals) |
| Villas in Limassol | ≈ 6.5–8% (especially high-end) |
| Off-plan delivered in Larnaca | ≈ 7–9% |
| Tourist Areas (Airbnb, Coast) | Up to 9–10% in high season |
In practice, small apartments (one to two bedrooms) close to universities, business centers, or the seafront often outperform, with a good balance between rent and acquisition budget. Luxury villas, especially on the coast, offer high rents but require more sophisticated management (high/low season, concierge services, tourism marketing).
The key point is that rental demand shows no signs of structural weakness. Major cities record high occupancy rates, and experts do not expect a significant drop in 2026, even if the pace of rent increases will remain moderate.
Real Estate Market Experts
City Spotlight: Where to Buy Based on Your Investor Profile?
Each region of Cyprus has its own real estate personality. To choose where to invest, it’s better to consider your main objective: rental yield, capital appreciation, permanent residency, or a combination of the three.
Limassol: The Cypriot Real Estate “Golden Mile”
Limassol tops the charts on almost all indicators. It’s the most expensive city, the country’s economic heart, and the most liquid market. Prices per square meter are the highest, especially for marina projects and luxury residential towers that have reshaped the waterfront. In 2024, average levels measured around €6,485/m² in some segments, well above other districts.
The typical clientele includes multinational executives, entrepreneurs, finance professionals, and shipping magnates, as well as many wealthy expatriates from Russia, the UK, Israel, or the Middle East. Apartments are highly sought after, especially in neighborhoods like Agios Tychonas or Germasogeia, close to the waterfront and new marina projects.
For an investor, Limassol’s main interest lies in the combination of “capital appreciation + resale security“. Over the past five years, the average annual price increase in the district has been between 6 and 10%, and forecasts for 2026 still bet on +6 to +8%. Well-located properties sell within months with a resale premium of 10 to 15% compared to original levels.
Rents are proportionate: a two-bedroom apartment often rents for between €1,200 and €1,500 per month, sometimes more for very high-end residences. Gross yields for moderately expensive apartments revolve around 5 to 7%, while prestige villas catering to corporate or high-end tourist clients can generate 6.5 to 8% gross yield.
Limassol requires significant investment capital to enter its real estate market. This destination primarily targets investors with substantial funds, willing to pay a premium for its assets: an attractive location, high-quality infrastructure (such as international schools, modern clinics, and luxury retail), and a deep, dynamic rental market.
Paphos: Recent Capital Appreciation Champion and Short-Term Rental Hub
Paphos is the other major star of Cypriot real estate. In 2024, the city recorded a spectacular price increase, around 21.4% on average, with increases of over 13% for houses and 12% for apartments according to some sources. The average price per square meter is around €4,700/m² in the best locations, with general ranges between €2,000 and €3,500/m².
The dynamic rests on several pillars: an image of a peaceful seaside destination, highly popular with British and other European retirees; a convenient international airport; and a well-developed holiday tourism market, especially in areas like Kato Paphos and Coral Bay. Short-term seasonal rentals like Airbnb are flourishing, with high occupancy rates for the vast majority of the year.
Rental yields are particularly attractive for investors focused on “short-term rentals”. On some developments, advertised gross yields are between 7 and 9%, with 5-8% commonly achieved on holiday rentals. For long-term rentals, one can reasonably aim for 5 to 6% in a good location, which remains very respectable given the capital appreciation potential.
For 2026, Paphos is among the markets where price increases could remain the strongest, with forecasts between +8 and +12%. However, price levels remain generally lower than in Limassol, making it an interesting destination for an investor seeking a compromise between entry budget, yield, and price increase prospects.
Larnaca: The “Rising Star” for Value Investment
Larnaca has long been considered the less glamorous little sister of Limassol and Paphos. But it may be where the best “value for money” opportunities lie today. Prices remain the most affordable among major urban centers, with a median price around €297,000–€307,000, and apartments sometimes accessible from €150,000–€200,000.
This is the amount, in euros, invested in the vast Larnaca port and marina redevelopment project.
In terms of yield, Larnaca posts very competitive figures. Apartments generally offer between 5 and 6.5% gross yield, with estimates going up to 7-9% on some off-plan projects upon delivery. For an investor targeting long-term rental to expatriates, young professionals, or local families, it’s a market to watch closely.
Price increase forecasts for Larnaca in 2026 project growth in a band of +5 to +7%. Nothing explosive, but a steady trajectory supported by ongoing infrastructure projects (port, marina, road axes, new residential neighborhoods). In short, the ideal candidate for a first rental investment with a reasonable down payment.
Nicosia: Stability and Year-Round Rental Flows
Nicosia, the inland capital, doesn’t have the beaches of Limassol or Paphos, but it offers what others cannot guarantee with the same stability: a domestic rental demand, less seasonal, fueled by government offices, businesses, embassies, universities, and international institutions.
The median price for a home in Cyprus ranges between 300,000 and 350,000 euros, making it the most accessible entry point for an investor in a major urban center.
Gross yields fluctuate between 4.5 and 6% for apartments, slightly less for houses. The market doesn’t promise a price surge, but rather a steady progression, favored by rising incomes and the relative scarcity of new upscale projects in sought-after neighborhoods like Engomi or Strovolos.
Nicosia stands out as a destination of choice for an investor who prioritizes stability and visibility over rental cash flows rather than a capital gains “win” on a beach area.
Other Locations to Watch
Several localities offer very specific profiles.
Coastal villages like Pissouri, halfway between Limassol and Paphos, attract a clientele of retirees and second-home owners, drawn by tranquility and sea views. Mountain villages like Platres, in the Troodos Mountains, position themselves in the “four-season” tourism niche, with boutique hotel and ecotourism projects.
On the east coast, Ayia Napa and Protaras are distinguished by their marked dependence on summer tourism, with very high yields in high season but significant vacancy periods the rest of the year. It’s a niche market, suitable for investors willing to accept more volatility in exchange for high seasonal yields.
Finally, the Famagusta region shows a more fragile dynamic, with a lower number of transactions and a less clear political environment, not to mention the legal risks in the northern part of the island, which is not recognized by the EU. For a prudent investor, it is generally advisable to focus on the Republic of Cyprus in the south.
Which Type of Property to Choose: Apartment, Villa, New or Resale?
Beyond location, the property profile heavily influences investment performance.
Apartments constitute the most liquid and dynamic segment. They account for the majority of transactions and show the best performance in terms of price increases and rental yield. Between 2020 and 2025, their valuation consistently outpaced that of houses, peaking at +8.8% annual increase in 2025 on some indices. For 2026, forecasts place their appreciation between +6 and +10%.
The average yield index for houses across the island of Cyprus is approximately 3%.
The choice between new and resale is also structuring. New developments (off-plan) often offer discounts on the order of 5 to 15% compared to the expected value at delivery, and projections mention up to 15% appreciation between launch and key handover, which can generate 15 to 25% return on investment in two to three years for well-calibrated operations. They also allow meeting the conditions for permanent residency (only new properties from €300,000 are eligible for the program).
Investing in pre-construction (off-plan) carries risks, including construction delays, possible financial fragility of some developers, and sometimes significant delays in obtaining final title deeds. Statistics indicate that a significant share of new projects experiences delays in issuing property titles.
Resale properties, on the other hand, escape the 19% VAT that applies to new builds (except a reduced rate of 5% for some first-time buyers for a primary residence). They are often cheaper per square meter, offer a history, and allow for easier verification of clear title deeds. However, they generally do not grant access to permanent residency by investment schemes.
What Does an Investment Really Cost? Taxes, Fees, and Charges
Beyond the advertised price, the investor must budget an additional 8 to 10% of the purchase price to cover ancillary costs, at the risk of underestimating their financing needs.
The main items are VAT on new properties (19% standard, or 5% under conditions for a primary residence), stamp duty (0.15 to 0.20% of the price, capped), transfer fees (between 3 and 8% of the price depending on brackets, reduced if VAT has already been paid), lawyer’s fees (generally 1 to 2% of the price), plus possible costs for property surveys, utility connections, insurance, and communal fees.
Indicative Structure of Transaction Costs
| Item | Typical Order of Magnitude |
|---|---|
| Stamp Duty | 0.15% up to €170,000, 0.20% beyond (capped at €20,000) |
| Transfer Fees | 3–8% of the price (progressive scale) |
| VAT (new property) | 19% standard, 5% on 130 m² for first-time buyer primary residence |
| Lawyer’s Fees | 1–2% of the price |
| Various Fees (survey, registration) | A few hundred to a few thousand euros |
| Total Transaction Cost | Approximately 8–10% of the property price |
Long-term, holding costs remain relatively contained. The annual immovable property tax was abolished in 2017, there is no wealth tax or inheritance tax. Annual municipal taxes are modest (often €100 to €300), communal fees generally vary between €500 and €2,000 per year depending on the residence’s standard, and standard home insurance costs in the range of €150 to €400 per year.
The first €19,500 of annual rental income is tax-exempt. Non-resident taxpayers are only taxed on their Cypriot-sourced income. Capital gains on real estate is generally taxed at 20%, but exemptions exist, notably for a primary residence under conditions.
Investment Strategies Suited to Cyprus
In this context, several strategies are emerging for 2026.
Long-term rental investment (“buy-to-let”) suits major urban centers like Nicosia, Larnaca, and some neighborhoods of Limassol. It offers regular rents, yields of 4.5 to 6.5% and moderate vacancy, fueled by employees, civil servants, students, and long-term expatriates.
Short-term holiday rentals constitute the leading strategy in Paphos, Ayia Napa, Protaras, as well as some parts of Limassol. Gross yield can approach or even exceed 8 to 10% for well-managed properties, at the cost of a greater need for management (cleaning, check-in, platform marketing, review management, etc.).
This strategy targets seasoned investors, capable of selecting quality projects in locations with high potential and assessing their risks. In a favorable market cycle, it can generate capital gains of 20 to 30% on the initial outlay within a few years, particularly in urban renewal areas or on flagship developments.
Acquiring luxury seaside villas aims less at immediate gross profitability than long-term wealth appreciation and the possibility of targeting a high-end international clientele. Limassol, Paphos, and certain areas of Larnaca are particularly suitable.
Finally, for investors capable of committing larger amounts, commercial real estate (offices, retail, warehouses) can offer higher yields, around 7 to 10%, at the cost of a more technical market and a higher capital requirement (often €500,000 and above).
What Could Still Change by 2026: Regulation, Schengen, Residency
A point of vigilance for non-European investors concerns the possible evolution of the regulatory framework. Draft laws have been submitted to better regulate property acquisitions by third-country nationals, particularly regarding land size, location near sensitive areas (border, critical infrastructure), and the definition of a “foreign-controlled” company.
The stated aim of the authorities is to find a balance between attracting foreign investment, national security, and preserving housing access for local residents, as soaring prices make homeownership difficult for many Cypriots.
The pillars of Cyprus’ economic and geopolitical attractiveness, reinforced by its European anchorage.
Maintained economic policy aimed at attracting foreign investors through a favorable environment.
Membership in the European Union, guaranteeing stability, a regulatory framework, and access to the single market.
Competitive tax system designed to support investment and business growth.
A crossroads between Europe, Asia, and Africa, offering a unique logistical and commercial hub.
Future accession to the Schengen Area, simplifying flows and reinforcing access to the European market.
On the investment residency front, the permanent residency program starting from a €300,000 real estate investment remains the centerpiece of the Cypriot offering. Investigations by European authorities into former citizenship programs have certainly pushed the government to strengthen controls, but there is no question, at this stage, of abandoning this tool, which plays an important role in financing quality new developments.
In Summary: A Reasonable Window of Opportunity for 2026
For the Francophone investor interested in real estate in Cyprus, the landscape taking shape for 2026 is that of a mature market, less euphoric than in 2022–2023, but still oriented upwards, with structurally strong rental demand and some of the most favorable taxation in the Mediterranean.
Premium coastal areas like Limassol and Paphos will likely remain the engines of price growth and concentrate flagship projects, but with high entry budgets. Larnaca offers a more accessible entry point with strong appreciation potential, driven by port and marina renovations. Nicosia, finally, positions itself as a safe haven for stable year-round rental income.
The choice of property type and strategy (long-term rental, short-term rental, future resale, new development eligible for permanent residency) must be based on a detailed analysis of the numbers: targeted gross yield, investment horizon, budget, sensitivity to regulatory risks. But the data converges: in a context of moderate but sustained growth, Anchoring part of one’s real estate assets in Cyprus in 2026 appears, for many profiles, as a reasonable and potentially very profitable bet in the medium term, provided one is selective on location and works with serious professionals on the ground.
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Cyril Jarnias is an independent expert in international wealth management with over 20 years of experience. As an expatriate himself, he is dedicated to helping individuals and business leaders build, protect, and pass on their wealth with complete peace of mind.
On his website, cyriljarnias.com, he shares his expertise on international real estate, offshore company formation, and expatriation.
Thanks to his expertise, he offers sound advice to optimize his clients' wealth management. Cyril Jarnias is also recognized for his appearances in many prestigious media outlets such as BFM Business, les Français de l’étranger, Le Figaro, Les Echos, and Mieux vivre votre argent, where he shares his knowledge and know-how in wealth management.
