Real estate has always been a critical aspect of society. Over the years experts have noticed significant shifts.
With the onset of technology and globalization, societies worldwide have evolved, which has impacted the real estate market in several ways. From economic changes to sustainable living trends, the Cyprus Real Estate market has evolved into a sector with many new and different opportunities.
In this blog, we will examine some of the most distinguished social changes that have impacted the Cyprus Real Estate industry.
Population Growth and Urbanization
In Cyprus, owning a family house was the ideal goal for many locals. However, this trend has shifted, and there has been a gradual increase in apartment purchases around urban areas.
It is evident that societal changes have significantly impacted the housing preferences of people across the world and in this case, Cyprus is not an exception.
According to a recent analysis of transactions in Nicosia, 40% of the transaction value involved apartments, and two-thirds of these transactions took place in urban areas.
This shift is primarily driven by younger Cypriots who prefer smaller and more affordable units that are closer to amenities. Additionally, many investors are buying apartments to generate rental income, tapping into the growing demand for rental properties, especially in Limassol.
As more people move to cities, demand for housing increases, which has driven up the Cyprus real estate prices in urban areas. This trend is expected to continue in the coming years since the island is projected to see continued population growth.
Another important factor that has impacted the Cyprus real estate market is demographic changes.
The aging population has led to an increased demand for retirement homes. While the younger generation has different needs and preferences when it comes to buying a property in Cyprus. According to real estate news, this shift can be attributed to the aging of the native population and a decline in family size over the past two decades.
Furthermore, while the property needs have changed, younger Cyprios who have inherited some property, tend to put them up on the market instead of utilizing them as their own first home. This fact primarily caters to overseas property buyers in Cyprus rather than locals.
Eurostat data shows that the percentage of property owners in Cyprus has declined from 74.1% in 2009 to 67.9% in 2019. This decline is largely due to a change in social norms, such as an increase in employment and smaller family sizes.
The “Economy” factor is yet another important piece of the puzzle when it comes to the Cyprus property market.
Housing markets behave differently according to each economic status, but what does that mean exactly?
During a strong economy, the housing market is usually healthy. Once an economy slows, it can affect its housing market.
This fact affects the economy as housing-related activities decline and slows the overall economic activity of the country. This cycle breaks once economic improvement begins and housing prices reflect consumers’ ability to purchase.
In Cyprus’ case, as the economy develops, the entire island is attracting more foreign investors, which has driven up real estate prices, especially in Limassol.
The demand for apartments for sale and for rent in Limassol is peaking yet with the supply not being satisfactory enough the pricing has taken an upward direction.
Social trends are also a noteworthy factor that impacts the Cyprus real estate market.
In recent years we have noticed a transition in people’s preferences for sustainable and eco-friendly housing.
Property Energy Performance Certificates in Cyprus (EPCs) became compulsory in 2010. EPC categorizes buildings according to their estimated energy consumption. It takes into consideration the characteristics of a property’s structure, such as the layout, the building materials, and your electromechanical services.
Since then, developers are incorporating environmentally friendly features into their buildings, such as solar panels and rainwater harvesting systems. These actions help rank the properties from A to G, with A being the most energy-efficient and environmentally friendly property.
Social trends don’t stop with environmentally friendly or luxurious solutions. The housing priorities of people in Cyprus have gone through major adjustments.
The layout of the apartments that are being developed has shifted towards smaller and more functional units, with up to 5 rooms – including the kitchen and living room – making up 61% of the properties in 2011.
The New Status Quo
As the demographics in Cyprus continue to shift, it is becoming increasingly clear that the Cyprus real estate industry has been affected.
Population growth, demographic changes, economic development and social trends are all important factors. At the same time, these changes are crucial information investors could use to make the best decisions possible.
Reading about social changes and genuinely absorbing and understanding the wisdom behind the information, however, are two very different practices.
At CENTURY 21 we have created a team with the most capable Real Estate Agents Cyprus can offer.
The C21 team of experts can guide you through the market and its changes providing you with a clear image and strong evidence so you can make calculated steps on your next investment.