13/12/2021 11:19
Online auctions are now a popular choice for both buyers and sellers in Cyprus, says BidX1 Cyprus real estate manager Kritonas Onisiforou.
In an interview with StockWatch, he states that "in our previous auction, more than 80 bidders participated, raising almost € 3.5 million from the sale of 26 properties in a single day."
"In general, since January 2020, bids of € 120 million were submitted to the platform during our auctions, which proves the increased demand for the properties we offer and the confidence shown by those interested in our process.
"The public is increasingly looking for a more flexible, accessible and transparent way of buying and selling real estate", he emphasizes.
He points out that the pandemic highlighted the limitations and inadequacies of traditional models of buying and selling real estate.
He added that real estate remained an attractive option for investors and online media was vital during the pandemic, as outdoor travel was limited.
According to Mr. Onisiforou, if over time the cash loses its value and taking into account the negative interest rates in large savings, the purchase of a property is a reasonable investment.
"Real estate values tend to fluctuate in line with inflation and are more profitable investments than other options in times of high inflation," he said.
The head of BIDX1 states that residential real estate is still the most popular investment. Demand was high for both homes and apartments, especially after the government's interest rate subsidy scheme where those interested can benefit from a 1.5% loan interest rate for 4 years.
There was also a special interest in commercial real estate and agricultural land. Regarding the bidders, he notes that over 95% of the bidders on the platform are Cypriots or have their headquarters here on the island, which proves that Cypriots now want a more transparent, efficient and accessible method of buying real estate.
BIDX1 has more than 50 commercial and residential properties on the platform for the current month. So far, it has held 6 auctions. The auction on December 15 will be the last of the year.
How satisfied are you with the online auction results?
We are delighted that this is becoming a popular option for both buyers and sellers in Cyprus. At our latest auction alone, we had more than 80 bidders participating, with 26 properties sold on the day – raising almost €3.5 million.
To take a broader overview, since January 2020 we’ve seen more than €120m in bids placed on the platform during our Cypriot auctions – a clear indicator of the demand for the assets we offer on the platform and of people’s confidence in our process. The public are increasingly seeking a more flexible, accessible, and transparent way to buy and sell property; our model offers such benefits, hence its increasing popularity.
What type of assets are the most popular at present?
Residential real estate continues to be the most popular investment option. Demand has been very high for houses and apartments, particularly following the government’s decision to launch its housing support scheme which means that interested parties can benefit from a 1.5% mortgage rate.
Rising rents have also played a role in driving demand for these assets – people are seeking to buy their own house or apartment rather than paying high rents to a landlord, especially with the historically low borrowing costs that we are currently experiencing.
It is clear that the supply-demand dynamics for mid-range residential units (those at price points of approximately €100,000 – €200,000) and for residential plots below €250,000 within the main urban centres, will remain favourable.
What kind of interest are you seeing for commercial real estate?
Recently, we’ve seen increased demand for retail properties and agricultural land – residential property is not the only show in town.
The most popular agricultural land are those fields with access from a registered road, as well as access to key services like electricity/water. Obviously more remote locations tend to attract fewer bidders.
Are the interested parties Cypriots or foreign investors?
Over 95% of those bidding for Cypriot property on the platform in the last two years have been based here in Cyprus. Most of our bidders are Cypriots, indicating that people have welcomed a more transparent, efficient, and accessible method of buying property.
When we launched here in 2019, BidX1 was already a brand name abroad, having pioneered online auctions in various markets, but was relatively unknown in Cyprus.
Despite this, it was clear from our earliest days that Cypriots had embraced the model. Our first two auctions were proof of this; over 500 bidders registered to take part, with more than 100 properties sold across the two days.
When can we expect the next online auction?
Our next auction will be held on 15th December but interested parties can view the catalogue in advance on the BidX1 platform, where they can also register to take part in the auction.
How many auctions were held in 2021?
So far, we have held 6 auctions. The 15th of December auction will be our last of the year.
How many properties does BidX1 currently have at its disposal for sale?
We have more than 50 commercial and residential properties in Cyprus available on our platform this month.
What are the trends in property sales following the lockdown?
We were pleased that our digital approach to property sales allowed us to continue trading throughout the lockdowns; real estate remained an attractive option for investors and online channels were crucial during this period as movement was so restricted. Following the lockdown, houses, apartments, and residential plots were the most sought-after asset types on our platform – a trend which looks set to continue.
What is the real estate outlook following the pandemic?
Cash is losing its value over time, and with negative interest rates on savings, an investment in real estate is a smart choice. Real estate values tend to move in line with the inflation rate over time and can offer a safer investment than other options in times of high inflation.
At a broader level, the pandemic also exposed the limitations and inefficiencies of traditional real estate models. I believe that online sales will become increasingly common, driven by the clear benefits for both buyers and sellers.
A desire for greater transparency comes into play here too. At BidX1, our technology is a key enabler for such transparency; we reduce the risk of sales falling through by providing buyers with all the relevant information upfront, including all legal documentation, which can be viewed directly on our platform.
Potential purchasers can conduct due diligence prior to bidding, and they can also see all of the bidding in real-time on the day of the auction, as well as the final sale price.
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