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RICS Reports Further Falls In Cyprus Property Prices

The Royal Institution of Chartered Surveyors, Cyprus (RICS Cyprus) has released its quarterly Property Price Index (PPI), which tracks and assesses sale and rental prices of various property types across all districts in Cyprus.

The Q1 2014 PPI reveals significant declines in property prices in almost all cities and asset classes.

Across Cyprus, residential prices for both houses and flats fell by 1.4% and 2.6% respectively, with the biggest drop being in Famagusta (4.0% for houses and 9.3% for flats).

Values of retail properties fell by an average of 1.7%, whilst those of offices and warehouses fell by 1.4% and 0.9% respectively.

Compared to Q1 2013, prices dropped by 10.7% for apartments, 7.8% for houses, 14.8% for retail, 10.4% for office, and 11.4% for warehouses.

Across Cyprus – on a quarterly basis – rental values decreased by 1.4% for apartments, 1.6% for houses, 1.2% for retail units, 3.1% for warehouses, and 1.2% for offices.

Compared to Q1 2013, rents dropped by 11.3% for flats, 12.6% for houses, 23.3% for retail, 14.0% for warehouses, and 15.4% for offices.

As of 31/03/2014, the average property price in Cyprus for an apartment (defined as ‘Two bedroom; 85m²; Medium quality) was registered as €104,698, with Nicosia commanding the most at €112,809, and Paphos and Famagusta-Paralimni the least (€99,952and €83,378 respectively).

Meanwhile, the average price for an office space (defined as Grade A; City centre location; 200sqm) was recorded as being €364,723, with the Nicosia average peaking at €549,329. Average monthly rents for apartments and offices in Cyprus stand, overall, at €337 and €1,307 respectively.

The report indicates that at the end of Q1 2014, average gross yields stood at 3.9% for apartments, 1.9% for houses, 5.3% for retail, 4.4% for warehouses, and 4.3% for offices.The parallel reduction in capital values and rents is keeping investment yields relatively stable and at very low levels (compared to yields overseas).This suggests that there is still room for re-pricing of capital values to take place, RICS’ report comments