The first annual increase, after seven years, was recorded by house prices in the first quarter of 2017, according to a survey by the Central Bank of Cyprus that was published on Friday.
Specifically, house prices recorded a small increase of 0,2% on an annual basis in the first quarter of 2017.
Apartment prices recorded an annual increase for the second consecutive quarter (1,6%), while house prices recorded the smallest annual decrease since the end of 2010 (0,3%).
The Housing Price Index (houses and apartments) recorded the third consecutive quarterly increase (0,3%) in the first quarter of 2017. As reported, the continuing quarterly increases, although small, confirm the recovery of the real estate sector in Cyprus, as other relevant indicators erase.
Both the house price index and the apartment price index recorded an equal increase of 0,3% on a quarterly basis.
As mentioned, the recovery of the Cypriot economy at a steady pace, the reduction of unemployment and the strengthening of confidence, are factors supporting the positive course of real estate in Cyprus.
Price changes by province
On a quarterly basis, the house price index increased for the third consecutive quarter in the provinces of Nicosia (0,2%), Limassol (0,9%), and Famagusta (0,1%).
On the contrary, in the provinces of Larnaca and Paphos it recorded small reductions of 0,7% and 0,6%, respectively.
In terms of annual changes in the general house price index by province, Limassol recorded an increase of 0,9% in the first quarter of 2010. On the contrary, the other provinces recorded annual decreases, with the largest being in Famagusta (3,7%), and the lowest in Nicosia (0,1%). In the province of Larnaca, house prices recorded an annual decrease of 0,8%, and in Paphos 1,4%.
It is noted, however, that these annual reductions are slowing down and it is expected that if the recovery of the real estate sector continues, they will record increases in the near future.
On a quarterly basis, apartment prices increased by 1,4% in the province of Limassol and stabilized in the provinces of Larnaca and Famagusta. In contrast, in the provinces of Paphos and Nicosia, apartment prices recorded a quarterly decrease of 1,5% and 0,1%, respectively.
On the positive side is the fact that during the last four quarters for the province of Larnaca and three quarters for the provinces of Limassol and Famagusta apartment prices recorded either an increase or a stabilization.
In terms of house prices, the provinces of Nicosia, Limassol and Famagusta recorded small quarterly increases of 0,3%, 0,7% and 0,2%, respectively. A small decrease of 0,9% was recorded in Larnaca province while stabilization was recorded in Paphos province.
On an annual basis, apartment prices in the first quarter of 2017 increased in the provinces of Nicosia (0,2%), Limassol (2,1%) and Larnaca (3%). On the contrary, an annual decrease occurred in the provinces of Paphos (3,1%) and Famagusta (2,6%).
On an annual basis, house prices increased by 0,5% and 0,3% in the provinces of Limassol and Paphos, respectively. In the province of Nicosia an annual decrease of 0,2% was recorded, in Larnaca 2,5% and in Famagusta 3,1%.
Changes in other relevant indicators
The positive course of the real estate sector is reflected in other relevant indicators.
Specifically, the construction activity presents a significant recovery, since according to the production index in the constructions of SYK, it recorded an annual increase of 36,7% during the first quarter of 2017.
This was the largest increase in this index historically and is due to a low base. In addition, domestic cement sales recorded an annual increase of 36,5%, although in absolute terms sales are still at a level corresponding to that of 2012.
Approved building permits, which are considered a precursor to construction activity, recorded an annual increase of 13,4% in the first quarter of 2017, reflecting increases in both residential (14,5%) and non-residential (25) building permits. %).
Along with the increased construction activity, the demand for real estate presented for the eighth consecutive quarter an annual increase.
Specifically, according to data from the Department of Lands and Surveys, sales documents recorded an annual increase in the first and second quarter of 2017 of 10,1% and 28%, respectively.
The number of document sales with buyers holding Cypriot citizenship recorded an annual increase of 2017% in the second quarter of 20, while the corresponding number with foreign buyers recorded an increase of 53,7%.
According to the CBC Survey of Monetary and Financial Statistics, the interest rate on housing loans in the first quarter of 2017 averaged 2,9% compared to 3,1% in the corresponding quarter last year and 4,2% in the first quarter. 2015.
Regarding the prospects of the real estate market, according to the Economic Conjuncture Surveys (EOS) of the European Commission, they are moderately optimistic.
Specifically, the index of employment expectations for the next 3 months in the construction sector during the first and second quarters of 2017 reached an average of 3,4 and 9,8, respectively, which are the most positive indicators that have
recorded since 2008.
In addition, the index of expectations for real estate sales prices for the next three months in the first and second quarter of 2017 showed the first positive signs from 2008. Specifically, the first and second quarters of 2017 reached 1,5 and 3,8, respectively . Also, the construction activity index during the previous 3 months reached in the first and second quarter of 2017 on average 1,5 and 3,9, respectively.
The positive signs of the above indicators confirm the recovery of the real estate sector in Cyprus, it is reported.