Cyprus Real Estate Insights Backed by Data-Driven Research
Get expert analysis on market trends, rental yields, transactions, and more - straight from the AXIA team.
Get consulation
Cyprus
Population by District and Percentage (2019)
Key Advantages of Cyprus
- Legal and Regulatory Framework: Setting up a company is a simple and fast process. The legal system is closely linked to English common law.
- Taxation System: Attractive Tax Scheme: modern, simple and low rates (corporate tax rate is 12.5%). Extensive network of double tax Treaties for the avoidance of Double Taxation with over 60 countries. No property taxes.
- Geographic Position: It is located at the furthest eastern point of the Mediterranean, between Europe, Asia and Africa.
- Good Quality of Life: One of the most appealing climates worldwide. It is amongst the five safest countries in the world (Value Penguin 2015).
Gross Domestic Product (GDP)
Change in GDP
Source: IMF
Key Historical Events:
- December 2019: Coronavirus outbreak in Wuhan, China.
- March 2020: COVID-19 declared a global pandemic by WHO, leading to the first lockdown in Cyprus and other European countries. Termination of the Cyprus Investment Program.
- February 2022: Russia’s invasion of Ukraine raises concerns about Russian investment in Cyprus.
- October 2023: War between Palestinian organizations led by Hamas and Israel begins.
Main Sectors of the Cyprus Economy
Percentage of GDP per Economic Activity (2023)
Source: CySTAT, AΧΙΑ
Two Key Pillars of the Cypriot Economy
- Tourism
- Historically the main growth driver for Cyprus.
- Promoted as a year-round tourist destination.
- Paphos and Famagusta are the most attractive tourist spots, especially in summer (Source: CySTAT).
- Real Estate
- Accounts for 14% of GDP.
- Rising construction material costs significantly impact property supply and demand.
- Foreign buyers mitigate lost revenue from the collapse of the "golden passport scheme".
Tourism Industry
The tourism sector, together with the sectors that are directly or indirectly linked to tourism, are a very important source of development for the Cypriot economy. Until 2019, this percentage ranged from 13% to 15%. Measures taken to contain the spread of the COVID-19 pandemic, such as the ban on entry into the Republic, resulted in a rapid decrease in tourism arrivals for the years 2020 and 2021.
Source: CySTAT, ΑΧΙΑ
The tourism data for the year 2023 suggests a return to normalcy following the COVID-19 pandemic, with clear signs of a steady recovery throughout the year. At this pace, both arrivals and revenues appear to be only slightly lower than the levels of 2019. Compared to 2019 (which was a record year) tourist arrivals in 2023 were slightly lower (2019: 3,976,777 tourist arrivals and 2023: 3,845,652 tourist arrivals) but tourism revenues increased by 11.46% (probably related to increased prices of raw materials etc.).
In 2023 Cyprus came close to the record arrivals of 2019 despite the fact that tourists from Russia have decreased a lot especially compared to 2021 when they were 27% of the total, while now they are only 2%. Neighboring Israel is so far the second country of origin of tourists to the island, after the UK.
Building Permits
The real estate sector has always been one of the key pillars of the Cypriot economy, contributing to approximately 14% of the country’s GDP. For the year 2023 the trend was downward compared to 2022, except for Larnaca District, which showed an increase of 1%. However, 2021 was a transitional period, as due to the COVID-19 pandemic and the closure of businesses and public services during 2020, many projects were only officially licensed in 2021, due to limitations in 2020.
Source: CySTAT, ΑΧΙΑ