Cyprus’ housing is in crisis as foreign buyers take over the market

As housing becomes an increasingly pressing issue for the majority of Cypriots, Parliament is opening up a debate on the surge in real estate purchases by third-country nationals. Members of the Parliamentary Committee on Internal Affairs, alongside AKEL MP George Koukumas, have raised the matter for discussion, aiming to assess the impact this growing phenomenon is having on both the real estate market and society. The committee will also look at the golden visa program, which grants permanent residence to foreign buyers in exchange for purchasing property—a scheme that continues despite the termination of the golden passport program.

The Scale of the Issue

Koukumas emphasized that AKEL initiated the debate because the pace at which third-country nationals are purchasing properties needs to be addressed. "This is a phenomenon that the whole of society sees and talks about, but most of the political system is ignoring," Koukumas told K. He pointed to the data from January to October 2024, which shows that 40% of all property transactions involved non-Cypriots. However, this is likely an underestimate since it doesn't account for foreign companies registered in Cyprus. "We will ask the Interior Ministry to provide a clearer picture by analyzing the data more thoroughly," he added.

Between 2021 and 2024, over 35,000 properties were sold to foreigners—both European and non-European—according to the Land Registry Department. In comparison, property sales to Cypriots during the same period exceeded 200,000.

Impact on the Housing Market

One of the key issues up for discussion is how this influx of foreign buyers is affecting the housing market and the broader society. "It’s clear that this phenomenon is inflating property prices artificially, which, along with other factors, is driving up the cost of real estate," Koukumas explained. As a result, urban centers in Cyprus are becoming increasingly unaffordable for the average Cypriot, worsening the country's already dire housing crisis. Many of the properties are being marketed exclusively to wealthy foreign buyers, raising concerns about the future character of the island's cities. "We risk losing the essence of our cities, with more and more properties falling into the hands of foreign investors," Koukumas warned.

The Golden Visa Controversy

The debate will also cover the "golden visa" program, which offers permanent residency to foreigners in return for purchasing property in Cyprus. While the golden passport program was scrapped due to its controversial nature, the golden visa program remains in place. "This program continues despite calls for its termination, including from the Audit Office, which criticized its lack of transparency and control," Koukumas noted. Other European countries, such as Ireland, the Netherlands, and the UK, have abolished similar schemes, while Portugal and Spain have restructured their programs to prevent them from driving up housing prices. In Cyprus, however, the situation appears to be spiraling out of control, with nearly 6,000 golden visas granted by 2022.

Sales Numbers and Distribution

Data from the Department of Cadastre and Land Surveying shows that between 2021 and 2024, 35,468 properties were sold to foreigners, with the majority of these purchases occurring in Paphos (10,647 properties), followed by Limassol (8,829), Larnaca (8,545), Nicosia (5,431), and Famagusta (2,016). For comparison, Cypriot property purchases during the same period were far greater, with 239,878 sales in total across the island. In Paphos, Cypriots bought 28,428 properties, while in Limassol, 62,460 properties were purchased by locals.

Koukumas confirmed that AKEL has already submitted parliamentary questions asking the government to provide more detailed data on these transactions and is calling for a comparative study on the legislative frameworks in other European countries regarding foreign property ownership.

As the real estate market in Cyprus continues to shift, the debate in Parliament is just the beginning of what promises to be a heated discussion on how to address the growing influence of foreign investors on the housing sector.

*This article was translated from its Greek original