An annual increase of the Residential Property Price Index by 5% was recorded in the third quarter of 2025, compared with 4.7% in the second quarter of 2025, according to data from the Central Bank of Cyprus (CBC).
Apartment prices accelerated to 6.4%, while house prices slowed to 2.6% during the quarter under review.
According to the CBC, the overall RPPI (houses and apartments) recorded a quarterly increase of 1.2% in the third quarter of 2025, compared with an increase of 1.5% in the second quarter of 2025. This resulted from a slowing quarterly rise of 1.7% in apartment prices and a small increase of 0.4% in house prices.
As the CBC said, the Apartment Price Index recorded accelerating growth in all districts except Nicosia, where the same annual growth rate as the second quarter was recorded. The House Price Index in Nicosia recorded an annual decrease for the fourth consecutive quarter. An annual decrease was also recorded in Famagusta district in the third quarter of 2025.
In its press release, the CBC noted that these developments reflect the continued positive trajectory of demand, within the context of shifting preferences toward smaller properties due to increased construction costs.
More specifically, regarding property demand, according to data from the Department of Lands and Surveys (DLS), the total number of sales contracts in the third quarter of 2025 showed an annual increase, both from domestic and foreign buyers.
As for property supply, the CBC said that the trend of increasing approved building permits continues. According to available building permit data, an increase was recorded during January–July 2025 compared to the same period in 2024. The Business and Consumer Surveys (BCS) of the European Commission (September 2025) also indicate a gradual increase in supply, with the construction activity diffusion index for the previous three months remaining at a positive level for the past eight quarters.
Price changes by district
Regarding annual changes in general house price indices by district, an acceleration was recorded in Limassol (7.1%) and Larnaca (7.3%), while a slight decrease was seen in Nicosia and Famagusta (-0.5% and -0.3%, respectively). Paphos recorded a slowdown to 8.9%.
By type of property and on an annual basis, house prices slowed in Limassol and Paphos to 5.5% and 7.4%, respectively. Larnaca continued to record the same annual growth rate (4.2%) as in the previous quarter, while Famagusta recorded an annual decrease of -1.6%. The House Price Index in Nicosia recorded an annual decrease for the fourth consecutive quarter, reaching -2.7% in the third quarter of the year.
Apartment prices recorded accelerating increases in all districts except Nicosia, which recorded the same annual growth rate as the previous quarter (2.6%). Specifically, apartment prices accelerated by 5% in Limassol, 9.6% in Larnaca, 10.5% in Paphos, and 5.9% in Famagusta.
Other real estate market indicators continue to reflect positive developments in demand during the third quarter of 2025, the CBC notes. According to DLS data, sales contracts for all types of property recorded an annual increase of 8.9% in the third quarter of 2025 (4,444 compared with 4,081 in the third quarter of 2024).
The increase in sales contracts came from both local and foreign buyers. Specifically, during the quarter under review, an annual increase of 8.6% was recorded in the number of properties sold to local buyers (2,617 compared with 2,409 in Q3 2024), while the number sold to foreign buyers increased by 9.3% (1,827 compared with 1,672 in Q3 2024).
Regarding the number of sales contracts per district, most transactions occurred in Limassol (1,431), followed by Nicosia (981), Larnaca (921), and Paphos (878), with Famagusta (233) recording the lowest number of transactions.
As for the share of local buyers, in the districts of Nicosia, Limassol, Larnaca, and Famagusta it exceeded 50%, while in Paphos buyers were mainly foreign (68%).
Additionally, the CBC noted that the continued credit expansion in housing loans, combined with the gradual decline in interest rates for new housing loans, supports the real estate market. According to the latest CBC Monetary and Financial Statistics, the volume of new lending for housing loans recorded a significant annual increase of 22% (€972 million from January–September 2025 compared with €796.8 million in the same period of 2024). For the third quarter of 2025 alone, the annual rise in new housing lending reached 24% compared with Q3 2024.
According to the same statistics, the interest rate for mortgage loans fell to 3.03% in September 2025, compared with 4.27% in September 2024, supporting both demand-side developments and the gradual increase in supply of residential property.
The positive trend in housing loan growth is also reflected in the results of the CBC’s Bank Lending Survey (October 2025). Specifically, in Q3 2025, net demand for housing loans from households remained at the same levels as the previous quarter. Additionally, lending criteria for housing loans remained just as strict compared with the previous quarter.
According to banks’ expectations for Q4 2025, net demand for housing loans is expected to rise, while lending criteria are expected to remain unchanged, continuing the trend observed since Q1 2024.
Regarding housing supply, according to monthly data from the Statistical Service, the number of residential units for which building permits were approved, an indicator of future construction activity, recorded an annual increase of 4.6% in January–July 2025 (from 7,772 units in January–July 2024 to 8,128 units in the same period of 2025). Therefore, a gradual increase in the supply of residential units is expected in the medium term.
According to data from the European Commission’s Business and Consumer Surveys (September 2025), the index for construction activity in the previous three months continued to remain positive for an eighth consecutive quarter in Q3 2025 (12.5%). This aligns with the aforementioned gradual increase in supply, the CBC noted. The price index of construction materials recorded a marginal annual increase of 1.3% in the third quarter of 2025, remaining at historically high levels in recent years due to geopolitical developments and supply chain disruptions. For January–September 2025, the annual increase in the index was also 1.3%.
The European Commission’s property price expectations (September 2025) for property prices over the next three months continues to indicate a slowdown in house price growth, as it stands at a lower level in Q3 2025 (25.5) compared with the corresponding period last year (56.2). According to the CBC, this suggests that a smaller share of participants expect increases in property prices in Cyprus over the next three months. At the same time, a stabilization of the expectations index has been observed in recent months, consistent with the steady annual rise in the general Residential Property Price Index recorded in the first three quarters of 2025.
