25/09/2003 09:15
The latest report of the Economist Intelligence Unit, subsidiary of the British Economist, has showed that the construction sector in Cyprus is developing rapidly but with signs of overheating. Real estate agents, however, disagree with these estimates, stressing that the development of the Cyprus economy is based on strong foundations.
According to the Economist, the constant development of the sector may be seen through the volume of building permits (measured in cubic measures of building space), which for January-May 2003 increased by 19.2% compared to the corresponding period of 2002. The Economist figures have showed that there is a strong demand at the seaside areas of Limassol, Larnaca and Paphos, while the report of the Real Estates Agents Association reveals that the newly-built buildings in Nicosia have increased by 20-25% for January-July 2003. This has affected the resale prices that rose by 15%.
“Nicosia is not a market for tourist houses or houses for pensioners. The demand is, therefore, smaller compared to that of the seaside resorts”, Economist analysts Jan Friederich and Robert O’Daly said. The Economist reports that the price increase in real estates is partly attributable to the restricted offer that derives from the change in the city-planner zones, as well as the increased demand by speculators, who believe that the Cyprus’ accession in the EU and the possible solution of the Cyprus problem would further boost demand.
Real estate agents: We see no overheating
Real estate agents seem to disagree with the aspect that the sector has showed signs of overheating. Chairman of the Real Estate Agents Association, Solomon Kourouklides said that the “overheating occurs when the parameters that determine the offer and the demand are technical, unstable and changeable, but this does not apply in this case. This increase is normal and justified”.
Mr. Kourouklides also said that according to the Association’s data the increase of 20-25% concerns the housing property for the two years ended June 30, 2003. The Association is expected to publish a multi-page report including estimates for the prospects of the Cyprus real estate market.
Latest figures
According to CYSTAT latest figures, the volume of building permits has showed an increase of 19.6% for January-June 2003, while cement sales and the price index for January-July 2003 have increased by 8.4% and 5.1% respectively.
According to the Economist, the constant development of the sector may be seen through the volume of building permits (measured in cubic measures of building space), which for January-May 2003 increased by 19.2% compared to the corresponding period of 2002. The Economist figures have showed that there is a strong demand at the seaside areas of Limassol, Larnaca and Paphos, while the report of the Real Estates Agents Association reveals that the newly-built buildings in Nicosia have increased by 20-25% for January-July 2003. This has affected the resale prices that rose by 15%.
“Nicosia is not a market for tourist houses or houses for pensioners. The demand is, therefore, smaller compared to that of the seaside resorts”, Economist analysts Jan Friederich and Robert O’Daly said. The Economist reports that the price increase in real estates is partly attributable to the restricted offer that derives from the change in the city-planner zones, as well as the increased demand by speculators, who believe that the Cyprus’ accession in the EU and the possible solution of the Cyprus problem would further boost demand.
Real estate agents: We see no overheating
Real estate agents seem to disagree with the aspect that the sector has showed signs of overheating. Chairman of the Real Estate Agents Association, Solomon Kourouklides said that the “overheating occurs when the parameters that determine the offer and the demand are technical, unstable and changeable, but this does not apply in this case. This increase is normal and justified”.
Mr. Kourouklides also said that according to the Association’s data the increase of 20-25% concerns the housing property for the two years ended June 30, 2003. The Association is expected to publish a multi-page report including estimates for the prospects of the Cyprus real estate market.
Latest figures
According to CYSTAT latest figures, the volume of building permits has showed an increase of 19.6% for January-June 2003, while cement sales and the price index for January-July 2003 have increased by 8.4% and 5.1% respectively.
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