Cyprus sales continue to plummet

Property sales volumes continue to plummet in Cyprus, with no let-up in the downward spiral since July 2010. The number of homes being sold is now at a lower level than when the market crashed in 2009.

A Cyprus Department of Lands and Surveys report published this week shows that the number of contracts for the sale of property deposited at Land Registries throughout Cyprus in September fell for the fifteenth consecutive month.

Home sales numbers crashed by 11.5% last month with the number of contracts deposited reaching 608 compared with the 687 deposited in September 2010.

Total sales during the first nine months of this year now stand at 5,317, down 17.5% on the 6,446 sold in the first nine months last year. Sales are now down by nearly 10% on those of 2009; the year the market collapsed.

So far this year, Limassol is weathering the storm well with sales by just 0.8% below those of last year. But in Larnaca sales have fallen by 27.5%, in Nicosia they are down 23.7%, in Paphos they are down 22.5% and sales in Famagusta have fallen by 15.9%.

And sales to overseas buyers, which account for a quarter of all sales, fell by 37.2% last month, with the number of contracts deposited reaching 113 compared with 180 deposited in September 2010.

Economic uncertainty, lending restrictions and high interest rates are taking their toll on the island and, according to a recent report from Savills Research called "Spotlight on Second Homes Abroad," "buyers now favour more spacious units, in line with traditional overseas property buying trends. This reflects that today's buyers are motivated by lifestyle reasons rather than simply the opportunity for financial returns."

Cyprus needs to build more upmarket homes. According to Savills, "preference for low density environments and good accessibility, proximity to beaches, and the opportunity to sample local cuisine and culture, are all factors influencing choice of holiday home destination. Almost 60% of holiday home owners prefer quiet rural and village environments to urban areas."

Source: OPP