Cyprus house prices drop 1.7% in Q1

Global real estate trends have finally reached Cyprus, with residential house prices falling in the first quarter.
For the period January to March 2009, the BuySell Home Price Index recorded a cumulative decrease of 1.7% compared to December 2008.
Compared with the same period of 2008, prices fell by 2.2%. This is the first fall recorded since August 2005.
The hedonic BuySell Home Price Index is the only house price index in Cyprus.
Prices were quite volatile during the first quarter, which BuySell said is indicative of the uncertainty in the sector and the general economic environment.
Home prices recorded fell by 1.5% in January, increased by 2% in February and declined by 2.2% in March.
The BuySell Home Price Index closed at 140.52 (March 2009) bringing the Average Home Price in Cyprus down to EUR 187,053.

Russians have invested €2 billion in Cyprian banks

In an interview for Interfax, the President of the Russian Bankers Union said that as financial products the Cyprian banks are as attractive as the ones in Luxemburg – they offer convenient tax reliefs and at the same time they work under strict international laws. “In Cyprus, as opposed to other countries, there is a lot of budget excess,” says Edward Savoulyak – an investments advisor and reminds that first, in Cyprus there is no danger for deposits and second, the government is guaranteeing up to €100 000. In Russia .

Cyprus is not attractive only because of its banks. Kathimerini newspaper claims that Russians are also attracted by the real estate opportunities. Last year, 30% of all real estate sales were done with Russians. For the first three months of 2009, this percentage has increased to 40% and this way Russia is becoming the biggest foreign real estate investor on the island. Also, Russian tourists have increased because last year 31% of the issued visas for Cyprus were given to Russians.

Luxury homes with sea view in North Cyprus

Mini poll finds real estate bargains in Cyprus, U.K.

A mini-poll conducted on the FinancialMirror.com website has found that nearly a third of the visitors to the site would invest in real estate bargains in Cyprus. An equal number of 32% of those polled said that amid the present financial crisis they would invest in real estate in the U.K., while just under a quarter of those who responded said that they would not invest at all in any real estate this year.
Despite rapidly falling prices, Greece only accounted for one in ten of those who responded and only 3% said they would invest in real estate elsewhere in Europe.

For the latest poll on “Where will you spend the Easter holidays?”, go to www.financialmirror.com and check out the box at the bottom right hand corner.

Property prices slashed

According to BuySell ten of the properties are on sale for 50 per cent less than market value, while 45 properties are going for 40 per cent less and the remainder for 30 per cent less.

“The whole property sector has slowed down. The coastal areas – Paphos, Larnaca and Famagusta – have been particularly badly affected”, BuySell a marketing team member told the Cyprus Mail yesterday. “Prices had been rising since 2001-2002, so this is an unusual step for us to take”, he added.

Some of the ads indicate that the property for sale has not yet been completely built, and only feature the developer’s illustration rather than actual photos. This suggests that these particular sellers either no longer regard their property to be an attractive investment or are in financial difficulties.

The most recent BuySell Home Price Index (BHPI) showed that overall, property prices withstood the global property market recession in 2008, recording a year-on-year increase of 2.8 per cent, compared to a total increase of 19.2 per cent in 2007. One of the main factors in the 2008 figure was the worsening of global economic conditions.