Ask Wire's Pavlos Loizou warns that the jump in residential permits could put pressure on parts of the Cyprus market in 2027 and 2028, particularly in projects aimed at foreign buyers.
According to Cyprus Property News, Ask Wire founder and CEO Pavlos Loizou has warned that a sharp rise in building permits could weigh on parts of the Cyprus property market in 2027 and 2028. Ask Wire's analysis found permits for 8,978 residential units were issued between January and May 2026, up 63.7% from 5,484 units in the same period of 2025. Larnaca saw one of the biggest increases, from 953 to 2,342 permitted units, while Limassol and Nicosia also recorded substantial growth. Permits do not mean every home will be built immediately, but earlier approvals are already moving towards completion. Loizou said he sees less risk of oversupply in housing designed for local buyers, and more concern around coastal developments aimed specifically at foreign purchasers, since their success depends on overseas demand continuing. He did not describe a general collapse in demand: first-quarter 2026 apartment sales rose by 18% for units under €200,000, 36% for €200,000–€400,000 and 41% for €400,000–€1 million versus a year earlier, although activity weakened in the second quarter amid geopolitical tensions. New-build apartments are driving more transactions, while older properties are losing ground. In the first nine months of 2026, 14,969 sale contracts were deposited with the Land Registry, up 13.6% from 13,173 a year earlier. Affordability remains strained, Loizou noted: construction materials are about 20% more expensive than in 2021 and labour costs are also rising, which makes higher-income buyers a more attractive market for developers. Using a €250,000 apartment as an example, he estimated around €50,000 for a 20% deposit plus €12,500 in VAT (if the reduced 5% rate applied to the full price), or €62,500 upfront before other costs, with the rest requiring a mortgage. Nicosia, he said, is more reliant on domestic demand than Limassol, Paphos and Larnaca. He also called for more public rental housing, progressive taxation of idle land and better linking of property databases.