Until the beginning of 2020, the real estate scenario in Cyprus was very promising. A wide range of innovative properties were planned and the sales were also expected to show strength. However, the coronavirus pandemic of 2020 not only crippled the economy but also left a huge dent in the real estate markets everywhere. The real estate scenario in Cyprus was no different and was further affected by the termination of the Cyprus Passport Scheme which enabled the foreign investors to hold a Cypriot passport if they invested a certain amount in premium residences. As the world is healing from the pandemic and fighting it with vaccines, the economy including the real estate can be expected to make a comeback this year. The real estate trend in Cyprus is also expected to show improvement as compared to the last year.
Limited Property supply
Since the past year forced people to be restricted to their homes and imposed lockdowns across the world, a number of properties in Cyprus that were in the process of being developed were left unfinished. The uncertainty associated with the pandemic situation has resulted in developers being cautious this year as a result of which the new construction of projects will be relatively less. Also, the Cyprus property owners have also stepped back from the market in the hope to sell their property at a higher price once the world recovers from the pandemic and the market resumes its original status. All these factors have led to a limited supply of properties in 2021.
The events that took place in 2020 have severely impacted the demand in the real estate landscape of Cyprus. The nationwide lockdown, increase in unemployment and the travel restrictions imposed due to the coronavirus pandemic severely decreased the demand. This coupled with the termination of the Cyprus Passport Scheme in November 2020 has decreased the likelihood of foreign investors to buy premium residences. Therefore, the real estate trend in Cyprus will certainly witness a decreased demand in the beginning which however may change if the vaccines improve the status of the pandemic.
Since most corporate offices were forced to shut down and the employees had to work from home, the companies and businesses have reconsidered the use of an office space. Since the same kind of productivity or even more is being met with employees working from home, most companies may continue the trend in 2021 and give up the office spaces altogether. Alternatively, workspaces like warehouses remained busy even during the pandemic since most people were shopping online. This trend is expected to continue this year with more warehouses being constructed as more and more people are enjoying the benefits of online shopping.
A lot of shops and small businesses were severely affected by the pandemic and forced to close down. As the economic condition of people is still in doldrums, it is less likely that people will visit the malls for shopping. As most countries are experiencing a second wave of the virus and resurgence of mutant strains, a lot of people may be afraid to step outside. This may not bode very well for the mall owners as several more retail shops might have to close down due to poor business. The year 2021 may not see the development of any new malls or shopping centers. However, the development of properties which contain hospitals, clinics, pharmacy, health centers and diagnostic labs may see a rise this year.
To conclude, the real estate market in Cyprus will be a bit sluggish in early 2021 and may pick up pace towards the end of the year depending on the situation of the coronavirus vaccinations and government efforts.