Cyprus is not the only country facing mounting pressure in the rental market. Across Europe, housing affordability is one of the most urgent economic and social issues, affecting not only families and young professionals, but also labour mobility, talent retention, and long-term growth.
What makes the situation in Cyprus particularly complex is that the conversation often focuses on one headline solution: “build more”.
But in many countries, policymakers and urban planners have reached a more nuanced conclusion: building more homes does not automatically solve the rental gap, especially when a large share of new supply is absorbed by investment demand, short-term use, or sales-driven development.
That is why a growing number of European cities are turning to a model that has quietly reshaped the rental landscape elsewhere: Build-to-Rent (BTR).
Build-to-Rent: A Global Shift Toward Purpose-Built Renting
Build-to-Rent is a simple concept with major implications. Instead of developing residential units primarily for sale, BTR developments are designed, delivered, and held long-term as rental housing.
In practical terms, this means that homes are built specifically with renters in mind and remain permanently within the long-term rental market, rather than being sold unit by unit. These developments are operated under professional management structures, ensuring consistent maintenance standards, responsive service, and greater stability for tenants. The model is designed to prioritise long-term occupancy and operational quality rather than short-term sales returns.
The model is now a mainstream part of housing supply in countries such as the United States, where institutional rental developments dominate many city centres. It has also expanded across Europe, with growing adoption in markets such as Germany, the Netherlands, and Denmark—where long-term renting is a normal and respected housing choice.
The UK, while later than other markets to adopt BTR, has seen rapid growth in recent years. Recent industry data shows that thousands of BTR homes have been delivered over the past five years, with many more under construction or in planning.
Why the Model Matters: Rental Housing Is No Longer a Side Issue
One of the most important lessons from international experience is this: rental housing is no longer a secondary market.
Across Europe, home ownership is gradually declining. More people, especially younger professionals, families, and mobile workers are choosing or needing to rent for longer periods of their lives.
This shift is reflected in the latest Eurostat data, which highlights significant differences across Europe in how people live, what they can afford, and how secure their housing conditions are.
And while Cyprus remains one of the countries with low overcrowding rates, Eurostat data also shows that Cyprus has one of the highest rates of under-occupied housing in the EU, a sign that the existing housing stock is not always aligned with current demographic and market needs.
The key message is clear: the issue is not only how much housing exists, but how effectively it serves today’s demand.
What Other Countries Are Doing Differently
In markets where rental pressure has become a national issue, governments and institutions have increasingly supported housing models that strengthen long-term rental stock.
The UK’s experience is one example. A recent Financial Times article highlighted how professionally managed rental developments have expanded in cities such as Manchester and London, responding to growing demand from tenants seeking greater stability and service. Rather than focusing solely on price, many renters increasingly prioritise predictable tenancies, responsive management, consistent maintenance standards, and a more secure overall renting experience.
The UK is also tightening rental regulation to protect tenants, while at the same time facing a decline in small landlords, many of whom are exiting the market due to rising compliance costs and taxation. This shift has created space for professionally managed rental housing to expand.
In other European countries, Build-to-Rent has been adopted as part of wider urban planning strategies, particularly in cities where labour mobility and talent attraction depend on accessible, long-term renting.
A Supply-Led Path Forward for Cyprus
The most relevant takeaway for Cyprus is not to replicate international models blindly, but to understand what they prioritise.
A supply-led approach that genuinely strengthens long-term renting would centre on expanding the volume of rental housing that remains permanently in the market. It would require professional management standards that ensure consistent quality and service, while supporting more predictable pricing mechanisms that reduce volatility for tenants.
At the same time, rental supply would need to be better integrated into broader urban planning strategies, so that new developments respond to real demographic and labour-market needs rather than short-term investment trends. Reducing speculative distortions in the delivery of new housing would also be critical to ensure that supply effectively reaches residents.
This is where Build-to-Rent becomes particularly relevant.
The model does not replace the wider housing market, nor does it seek to dominate it. However, it can help address a structural gap: the limited availability of large-scale, professionally managed rental housing that remains consistently accessible to residents over the long term.
