Property prices are still dropping in Cyprus, and the asking price of homes has fallen by 25% in the last 18 months. Even these huge discounts are not sufficient to attract buyers, as the only property is being sold are those regarded as being real bargains.
The price drops are being blamed on a combination of factors including the global recession, the problem with title deeds and stricter lending conditions. Apparently banks have cut the number of mortgages by as much as 50% as they are too scared to lend. Of course some properties were simply priced too high for the market and a correction was inevitable.
It's not all gloom and doom, as some experts remain optimistic about the future of the property market, and feel that certain places have just fallen out of fashion, while those nearer the sea or with good views are holding their value. Properties in Paphos had been particularly badly hit, but there are signs that the market may be picking up here, as large numbers of Russians are choosing to buy property here as Paphos is seen as a quiet, beautiful and safe location.
British buyers are still in short supply, although some Cypriots are taking advantage of the low prices to invest in property. The story isn't much better for the rental market as a villa which would have previously been rented for €600 a month will now rent for €500, but there are hopes that improved tourism figures may help boost the property market. Revenue for tourism was up 53.5% in April.
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