Is It The End Of The Cyprus Property Boom?

Is It The End Of The Cyprus Property Boom?

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villas in cyprus

Real estate offices in Cyprus are struggling to sell properties and more of them have increasing fears of loosing their jobs. The main contributing factors to this demise is the loss of the British pound against the Euro and the fact that unemployment in the UK reached an all time high – the worst in nine years.

This is only too good felt in Cyprus, previously a Mecca for British property buyers. Now that the clientele is short, Cyprian real estate is feeling the pinch and resort towns like Paphos and Paralimni have lost up to 25 percent value on their real estate since December last year.

Another inclination of the declining market is the drop in building permits. They went down by 2.4 percent last year up until November and the outlook isn’t really that rosy either.

With the biggest recession since the 1980s hitting the UK, buyers are pulling out of the secondary home market to save their skins and what’s left of it.

A shrinking economy, house price losses and job cuts also don’t help to change this situation around real quick. Right now we can be lucky if we have a job and are able to feed family as well as provide a roof over our heads.

The biggest homebuilder in Cyprus, Aristo recorded a massive 41 percent decline on sales during the first 10 months of last year alone. Demand has fallen and the once hot market is now close to dormant.

Even those looking to escape into the sun from cold Britain struggle to sell their properties to move to Cyprus. There just isn’t a market right now, leaving many home owners who could afford the move stuck in Britain.

In the past, the British were known to spend millions overseas as they scrambled to be part of the crazy secondary housing boom all around Europe. But now they are being cautious and keep holding on to their surplus money – if all to out wait the bad economy and protect them against bankruptcy.

As a former British colony however Cyprus really depends on the UK buyers to keep their economy afloat. Those who want to sell to save their necks have to expect a 30 percent loss of investment from last year alone. It’s tragic really and the only fact is that we are mostly in the same boat, fighting to keep going on.

How do you feel about investing overseas? Share your opinions, thoughts and worries in the comment section.

Photo credits: Richard Bloomfield via Flickr