Specific trends in the Cyprus property market are becoming established, with the Larnaca district recording the highest overall growth whilst residential properties significantly outperform commercial real estate across all districts.
The RICS Cyprus Property Price Index with KPMG in Cyprus for the second quarter of 2025 shows continued increases in the Larnaca district, which records the highest overall development.
Another standout element is year-on-year increases recorded in houses and apartments, whilst a third interesting factor is the continued subdued performance of commercial properties.
By district
Price changes in the second quarter show specific continuing trends. Larnaca stands out with the highest overall development, particularly in warehouses and residences.
Nicosia also presents stable residential performance, with both houses and apartments recording further increases.
Conversely, in Limassol changes were almost unchanged in most sectors, including decreases in warehouse and commercial property prices.
Paphos presented the steepest drop in warehouses, although apartment prices increased moderately. Office spaces remained generally stable across all areas, with Famagusta leading with the largest increase.
By property type
Compared to the previous quarter, houses presented the strongest increase, followed by warehouses and apartments. At the other end, offices and commercial properties remained the most subdued sectors.
Examining year-on-year data, apartments and houses presented the largest increases, followed by offices and warehouses. Commercial properties presented the smallest increase, continuing the trend of being the least favourable asset for investments.
Regarding rental prices, overall they continue to increase compared to the previous year, with the largest percentage increase observed in apartments, followed closely by warehouses.
Small increases were recorded in remaining categories, whilst commercial properties showed a small decrease.
Holiday properties also record strong performance, with holiday apartments specifically leading, reflecting sustained demand in a tourism-based economy.
Both holiday apartments and holiday houses recorded further increases over the past year. At district level, the largest quarterly increases were recorded in Larnaca for both holiday houses and apartments, whilst the smallest gains were in Paphos.
Returns
Returns have recorded very marginal movements from last year, with commercial properties recording a slightly larger drop.
Specifically, apartment yields in Q2 2025 were 5.41% compared to 5.43% in Q2 2024. House yields were 2.97% compared to 3% last year. For commercial properties, yields were 5.75% versus 5.80% in last year’s second quarter.
Warehouses were 4.24% versus 4.25% last year. Offices remained stable with 5.61% yield both last year and this year. Holiday apartments were 5.75% versus 5.77% last year, and holiday houses 2.79% compared to 2.78% last year.
KPMG’s Christophoros Anagiotos, Managing Director and Head of Real Estate and Land Development, noted Q2 presents increases in apartments and houses, with Larnaca recording the largest changes, particularly in houses and warehouses.
Conversely, Limassol presented almost zero or even negative changes. In the retail sector, changes remained limited except in Larnaca where notable increases occurred.
RICS Chief Economist Simon Rubinsohn emphasised that Cyprus economy shows stability trends, reflected in both RICS-KPMG Index results and Q2 RICS Commercial Property Monitor. He noted investor sentiment remains positive.
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