RICS in Cyprus reports that house and apartment pricesacross the island rose 1.2% and 1.4%, respectively, for the first quarter of2019. During the second quarter of 2019, the Cyprus economy showed furthersigns of recovery, with seasonally adjusted quarterly GDP growth of 0.7% andannual seasonally adjusted GDP growth of 3.2%. Unemployment fell to 7.0% from7.2% in the previous quarter and a record high of 17.6% in the first quarter of2015. Increased confidence in the banking system of Cyprus and increased accessto finance, respectively, contributed to relatively higher volumes during thequarter, which further strengthened market sentiment.
Limassol recorded the largest quarterly increase inapartment prices by 3.87%. House prices also rose 1.8% in the quarter.Famagusta has the highest rise in home prices - up to 2.94%, and in Limassol -the highest rise in apartment prices - up to 2.08%.
On an annualized basis, apartment prices rose 8.1%, houses7.7%, offices 6.0%, warehouses 3.6% and retail sales 4.0%.
Rent price
On a quarterly basis, rental value increased by 4.6% forapartments, 3.2% for houses, 0.9% for retail, 0.2% for offices, whilewarehouses remained unchanged.
On an annualized basis, rents increased by 16.4% forapartments, 14.4% for houses, 7.0% for retail, 4.9% for offices and 1.3% forwarehouses. With the exception of warehouses, all asset classes show consistentquarterly growth.
At the end of the second quarter of 2019, the average rentalyield was 4.8% for apartments, 2.5% for houses, 5.7% for retail, 4.1% forwarehouses and 5.0% for offices. Rental income is a useful indicator of whethera property is overvalued, underestimated, or correctly valued.