Newsroom
Building a home in Cyprus has become noticeably more expensive over the past year, with construction material costs rising sharply and adding fresh pressure on property prices across the island.
According to Stelios Gabriel, President of the Federation of Cyprus Building Contractors’ Associations (OSEOK), the price of key construction materials has increased by about 10% in just the last two months alone. Over a five-year period, the total rise reaches roughly 35%.
Speaking to CNA, Gabriel said the increases are being driven largely by global developments, including geopolitical tensions involving Iran, higher energy costs, and rising expenses linked to emissions allowances imposed on industrial production.
He noted that materials such as steel, iron and aluminum have been hit particularly hard, all essential components in building construction.
“These factors don’t help bring costs down,” he said, explaining that ongoing instability and high energy prices continue to keep construction expenses elevated. Because materials like steel are used extensively in building work, even small price increases can significantly raise overall construction costs.
What this means for homebuyers
For the average Cypriot, the impact is expected to be felt most clearly in the price of new homes.
As construction costs rise, developers are passing a portion of those increases down the line, meaning higher asking prices for apartments and houses, especially in new builds.
In simple terms: building a home today costs more than it did a year or two ago, and that difference eventually shows up in the final sale price.
Construction activity still strong
Despite the cost pressures, Cyprus’ construction sector remains highly active, with both public infrastructure projects and private developments continuing at strong levels.
OSEOK data and broader market indicators suggest the sector is still growing in the early months of 2026, showing resilience even as input costs rise.
Property market still moving upward
Real estate sales are also on the rise across the island.
Larnaca is leading the way with an estimated 40% increase in activity, while Nicosia follows with around 30% growth. Limassol and Paphos continue to show steady upward momentum as well.
Gabriel noted that the increase in Nicosia is driven mainly by local buyers, alongside growing interest from foreign investors and companies who are increasingly looking at the capital as an attractive and relatively affordable base for living and business activity.
Smaller homes, new reality
One clear shift in the market is the type of housing in demand.
Developers and buyers are increasingly focusing on smaller homes and apartments, as rising construction costs and stricter energy efficiency standards make large homes more expensive to build and harder to afford.
