The Government considers the response of both citizens and land development entrepreneurs to the affordable housing plans announced in October 2023 to be encouraging, under the circumstances.
In fact, responding to relevant questions from MPs Marina Nikolaou (AKEL) and Andreas Apostolou (EDEK), the Minister of Interior, Constantinos Ioannou, has provided interesting data regarding the applications for participation and the number of those approved and rejected, as well as the Cyprus Land Development Corporation’s (CLDC’s) affordable housing schemes.
More specifically, AKEL MP Marina Nikolaou, through her question, requested information on the following:
How many participation applications have been registered to date for these specific projects, how many were approved and how many were rejected?
What are the comparative results to date for the supply and demand of housing units produced through the unified housing policy schemes?
How many land development entrepreneurs have chosen to take up the urban development factor incentive, how many have signed an agreement with the government to date for the production of affordable housing, and how many affordable housing units are planned to be placed on the market based on the agreements to date?
Based on the CLDC’s schemes, how many affordable homes for sale and how many with affordable rent were put on the market in 2023 and 2024, as well as how many are planned to be put on the market in the next three years?
The schemes and their performance
In response, the Minister of the Interior states, in relation to the first question, that the response to the schemes to date is encouraging, especially if one takes into account the fact that time is required to inform interested parties about the existence of the schemes and their provisions and then to mature their applications in order to submit them.
As he notes, the performance data is as follows:
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Housing grant scheme for young couples and/or young people up to 41 years of age (1st call 2024 and 2nd call 2025): 525 applications were submitted, of which 152 applications were approved for financial assistance of approximately €5.4 million, 200 applications are pending for evaluation, 172 applications were rejected and one was withdrawn.
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Renovate-Rent Scheme (1st call - 2024 and 2025): 43 applications were submitted, of which 28 applications were positively evaluated for financial assistance of approximately €727,000, six applications are pending evaluation and nine applications were rejected.
Regarding the comparative results for the supply and demand of housing units produced through the unified housing policy plans, Ioannou emphasises that "the goal is in the medium term to balance supply with demand and to reduce the cost of acquiring a home, as well as the amount of rents."
To this end, he underlines, particular importance is given through housing policy to projects that aim to increase the supply of available housing units on the market, with the aim of covering increased demand and gradually depressuring prices, such as projects that concern urban planning incentives and Build to Rent, the Renovate-Rent plan and the CLDC affordable housing production schemes.
According to the Minister of the Interior, the plans aim to create additional supply beyond what the private sector would produce in the absence of incentives.
"Because these projects require time to produce visible results and have an impact on the market, it is not possible at this time to draw safe conclusions regarding their potential performance, however, it is expected that within the next few years they will cover part of the increased demand that is observed," he emphasizes.
The response of land development entrepreneurs
In relation to the number of land development entrepreneurs who chose to take up the urban development factor incentive and how many have signed an agreement with the Government to date for the production of affordable housing and how many affordable housing units are planned to be placed on the market based on the agreements to date, Ioannou states the following:
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Utilisation of incentives through the method of payment of monetary compensation (buyout): Based on the applications to date, financing of approximately €5 million is expected for the purposes of constructing affordable housing from applications corresponding to seven land development entrepreneurs.
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Utilisation of incentives for the production of affordable housing: The number of agreements signed between CLDC and land development entrepreneurs for the utilization of incentives, as well as the number of affordable housing units produced, are as follows:
-Total signed agreements: 16
-Number of affordable housing units based on the agreements signed to date: 84, of which 65 for sale at affordable prices through the exploitation of urban planning incentives and 19 for affordable rental through the exploitation of the Build to Rent incentive.
The CLDC schemes
Regarding CLDC’s schemes for the construction of affordable housing for purchase and how many affordable rental housing units were put on the market in 2023 and 2024, as well as how many are planned to be put on the market in the next three years, the Minister of Interior notes that, based on CLDC's development programme:
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Within 2023, it completed and put 16 affordable housing units for sale.
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In 2024, it began construction of 24 affordable housing units, which will be completed and delivered in 2025.
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Within 2025, construction has begun/will begin:
-135 affordable housing units for sale
-36 affordable housing units for rent
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Within 2026, it plans to begin construction of:
-96 affordable housing units for sale
-156 affordable housing units for rent
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Within 2027, the implementation of the above projects is planned to continue for their release to the market, as well as KOAG will reassess its planning for the production of additional units depending on resource availability and demand.
Planning for the Larnaca district
Furthermore, responding to a question from EDEK MP Andreas Apostolou, regarding CLDC's planning for the construction of houses and apartments for purchase or affordable rent in the city and district of Larnaca, the Minister of Interior states that the Corporation is constructing the project called "IANTHI" in Larnaca, which consists of 24 two- and three-bedroom apartments, which are expected to be completed in September 2025.
The project, he adds, is being constructed on one of the two plots of land that resulted from the division of a plot of land owned by CLDC, in the parish of Ayios Nikolaos in the Municipality of Larnaca.
It is noted that 16 apartments are available for sale, while the remaining six have been sold.
Furthermore, Ioannou adds, the CLDC is planning the construction of an additional 16 units (1st and 2 bedroom apartments), on the second plot of the same development and for this purpose, provision will be included in CLDC's Budget for 2026.
According to the Minister of Interior, there is great interest in urban planning incentives in the Larnaca District. Specifically, so far, CLDC has signed agreements with land developers for the production of 39 affordable housing units in Larnaca, which will be made available for sale to beneficiaries when completed.
(Source: InBusinessNews)
