Building permit problems remain largely unresolved in Cyprus, creating knock-on effects across the entire property sector, industry professionals told Phileleftheros.
Despite minor improvements, the situation at the District Local Government Organisations (DLGO), which now handle building permits, remains problematic and is hampering development whilst raising concerns for the broader economy, according to market professionals.
Leaders from the Cyprus Building Contractors Association (OSEOK) met recently with the presidents of the District Local Government Organisations to examine the licensing issue and discuss ways to resolve ongoing delays.
The problem is clearly reflected in monthly Statistical Service data, which no longer captures property market trends and cannot yield clear conclusions from permit numbers, sources said.
The authority to issue building permits transferred from municipalities and provincial administrations to the newly established District Local Government Organisations on 1 July 2024, with licensing procedures conducted through the new integrated information system “Hippodamos”.
However, it is generally accepted the transition did not proceed smoothly. Instead of reducing existing problems as authorities intended, they increased.
This occurred for four reasons:
The DLGOs assumed their new responsibilities with reduced staff numbers unable to handle the workload assigned to them.
The DLGOs did not start from scratch but inherited a large number of pending cases from municipalities and provincial administrations, meaning the delays problem began from day one of the new process.
The transfer of responsibilities occurred during a growth period for the property sector, translating to increased numbers of new building permits which added to already pending licences.
New areas were added to DLGO responsibilities regarding building permit issuance, creating another factor that contributed to increased workload for the newly established organisations.
Altered plans
The new situation created serious problems in the property market which extend beyond that sector, impacting both investment and the plans of households and businesses that expected to have their new property within a specific timeframe, only to see those plans significantly disrupted.
A large number of developments has been frozen due to building permit delays, sources said. This situation creates problems not only for the market but for the country’s reputation as an investment destination.
Delays are concentrated mainly in large developments. One project required two years to obtain planning permission and when it did, could not proceed as it still had not secured a building permit, sources said.
Problems also exist at another development stage—the temporary water supply provision, sources said.
A property obtains temporary water supply authorisation to enable completion, then receives final authorisation. Problems appear at that stage, also causing delays.
OSEOK-DLGO meeting
During the meeting with OSEOK, DLGO presidents appeared willing to help the situation and take measures to accelerate procedures.
They said that strengthening investment activity and improving licensing timeframes constitute central pillars of their mission.
According to them, achieving these objectives is linked to further autonomy for the organisations, completion of their staffing and strengthening of their financial resources.
They noted that despite the large volume of pending cases inherited in July 2024, the current rate of processing applications exceeds new submissions, which constitutes an indication of positive progress.
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