New research has found that property prices in Cyprus continued to fall in the first three months of 2011 with rents on the island also slipping as landlords struggle to attract new tenants. The fall has been attributed to the ongoing uncertainty regarding the Greek economy and a continuing lack of credit availability.
Prices and rents for property in Cyprus fall substantially over last year
The sixth issue of the Royal Institute of Chartered Surveyors (RICS) Cyprus Property Price Index found that prices for houses fell by 1.6 per cent in the first quarter of 2011 with values of apartments falling by 0.9 per cent over the same period.
Limassol saw the biggest drop in house prices (2.9 per cent) whilst Paphos saw a 4.1 per cent fall in the value of apartments. Commercial property in Cyprus fared slightly better, with retail properties falling by an average of 0.8 per cent whilst the values of offices and warehouses remained broadly stable.
In the last year, prices of houses have fallen by an average of 7 per cent while apartment values have fallen by 8.3 per cent.
Similarly, over the last twelve months rents have dropped by 6.1 per cent for apartments and 10.7 per cent for houses. Cyprus Property News reports that Ã¢â¬Ëthe quarterly change in capital and rental values shows that all aspects and geographies of the property market are now affected, and that landlords are lowering their rents in order to attract tenants.Ã¢â¬â¢
Pavlos Loizou, board member of RICS Cyprus, said Ã¢â¬ÅDuring the first quarter of 2011 Cyprus bore the brunt of the consequences of the increased uncertainty regarding the Greek economy and the, partly consequential, series of downgrades by rating agencies of Cyprus and of Cypriot banks.
Ã¢â¬ÅWhilst the first quarter saw some signs of price stabilisation and muted economic growth, the lack of credit and the on-going events in Greece affected sentiment. In turn this led to a low transaction turnover and to reduced interest by local buyers.Ã¢â¬Â