People building or renovating homes in Cyprus’s mountain areas and communities along the buffer zone can now receive up to €100,000 in combined government assistance under enhanced housing schemes announced by Interior Minister Constantinos Ioannou.
The total comes from combining the Interior Ministry’s increased grants – now up to €70,000 for these areas – with Energy Ministry grants of up to €30,000 for energy upgrades, which can now be claimed together for the first time.
The changes are part of a government push to increase housing supply and reduce costs through boosted grants, relaxed student accommodation rules, and faster licensing.
Mountain and buffer zone areas: bigger grants, easier access
Between 2019 and 2025, the schemes for mountain, buffer zone and disadvantaged areas received 2,892 applications, approving 2,027 for total grants of around €77 million. Now the schemes are being significantly enhanced.
The maximum grant is increasing by €5,000 for all rural scheme recipients and all family types. Income limits are rising by €5,000 across the board. Large families get an additional €5,000 through new categorisation by number of children.
Displaced persons receive an extra 20% on top of standard grants.
The government has scrapped the requirement for Cypriot citizens to prove continuous residency in Cyprus.
Most significantly, applicants can now combine Interior Ministry housing grants with Energy Ministry grants for energy upgrades – previously forbidden. Someone who would have received €70,000 can now get €100,000 total.
Applications open 2 March 2026 and run until 31 December 2027.
Renovate-Rent scheme gets second chance
The “Renovate-Rent” scheme flopped in its first iteration, receiving just 76 applications with only 40 approved for total grants of €1.2 million.
The government is trying again with sweetened terms:
Grants increase by €5,000 per unit. Offices and commercial spaces can now be converted to housing, provided change of use approval is secured. The scheme extends to buffer zone areas and rural areas. Electricity consumption limits rise from 200 to 500 kilowatt-hours per year. Income limits for tenants increase by €5,000.
Student housing: smaller spaces, fewer rules
New rules allow student accommodation units of up to 10 rooms with drastically reduced space requirements.
A five-room student unit can now be built in just 77 square metres – previously impossible under standard housing rules. Reception areas and storage spaces are no longer required. Parking drops to one space per five rooms instead of one per room.
The units can be standalone buildings or mixed with residential, commercial and office uses. They can be built new, carved out of existing buildings with change of use approval, or added to approved developments.
They must be within one kilometre of a registered tertiary education institution.
State developer back in action
The Cyprus Land Development Corporation, reactivated with €28 million in state funding, has 244 affordable sale units and 192 affordable rental units on track within 2026.
It’s subdividing 135 plots in Nicosia, Larnaca, Limassol and Paphos.
Private developers have filed 39 applications using new building incentives, creating over 2,500 units in the next two years including 275 affordable homes. Another 22 applications paid €11.5 million to buy additional building rights, with the money funding more affordable housing for low-income groups.
Licensing accelerated
New digital licensing rules are cutting approval times dramatically.
Over 2,000 applications for up to two homes were approved within 40 working days. Another 627 applications for apartment buildings up to 20 units were processed within 80 days.
This puts over 5,500 units on track for construction about one year earlier than under the old system, helping to ease prices when they hit the market.
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