Property prices in Cyprus take a tumble
Cypriot property prices have seen their biggest declines in years as the debt ridden nation’s austerity led bailout and ever deepening recession slashed demand in the once prosperous market.
Data released by the Royal Institute of Chartered Surveyors (RICS) the Cyprus property Price Index, showed that the price of an average house on Cyprus fell by 5% in the second quarter of the year. Apartment prices meanwhile tumbled by an average of 4.2%.
RICS Cyprus blamed the price declines on the European Union’s decision back in March to ‘bail-in’ depositors of two of the islands largest banks, to close down the Laiki Bank. The most damaging move was the imposition of capital restrictions being enforced which has left bank fiancés unavailable and deposits being frozen in blocked bank accounts.
Local demand for property in Cyprus is close to an all-time low. Only expat buyers have prevented further declines to property prices.
The worst affected area of the country is Larnaca which has seen the biggest decline in prices. Overall property values fell by as much as 9.2% from the first quarter of the year. Famagusta and Paralimni both witnessed price declines that are above the nation’s average, with prices declining by 6.6% in the first quarter of 2013.
As for apartment prices, the biggest declines in price were seen in Famagusta and Paralimni, where prices have declined by 6.7%. Nicosia was the next worst affected area with prices falling by 5.2%
Currently the average price of a house in Cyprus is around €349,125 (£305,285), whilst an apartment is around €112,318 (£98,214)