The latest RICS Cyprus Property Index with KPMG in Cyprus for the first quarter of 2026 shows the island’s real estate market continuing on a path of modest but steady growth. The report tracks both property sale prices and rental values across all districts and major property sectors in Cyprus.
Property prices recorded small increases across every asset class during the opening three months of the year. Residential property continued to demonstrate resilience, with apartments once again outperforming houses. Offices and holiday properties also posted modest gains, while retail premises remained the weakest-performing sector.
Apartments continue to lead property price growth
A year-on-year comparison highlights apartments as the strongest-performing property category in Cyprus, reflecting sustained demand for residential accommodation. Houses and warehouses also recorded healthy gains, while offices experienced more moderate growth. Retail properties continued to lag behind other sectors.
Year-on-year property value changes:
- Apartments: +4.09%
- Houses: +3.60%
- Warehouses: +3.48%
- Offices: +2.91%
- Retail premises: +0.72%
The data suggests that residential assets remain the preferred choice for buyers and investors, supported by strong underlying demand and limited supply in key locations.
Holiday property market supported by tourism demand
Holiday properties continued to register positive growth, although at a slower pace than seen in previous quarters. Holiday apartments remained the standout performer, underlining the ongoing strength of Cyprus’s tourism sector and demand for short-term accommodation.
Year-on-year holiday property price changes:
- Holiday apartments: +3.66%
- Holiday houses: +2.42%
The results point to continued confidence in tourism-related real estate, particularly in coastal and resort locations where demand remains robust.
Rental values rise across most property sectors
The rental market also maintained positive momentum during the first quarter of 2026. Apartments recorded the strongest increase in rental values, while offices and houses also delivered solid growth. Retail premises once again posted the smallest gain.
Year-on-year rental value changes:
- Apartments: +5.10%
- Offices: +3.03%
- Houses: +2.97%
- Holiday houses: +2.75%
- Warehouses: +2.58%
- Holiday apartments: +2.05%
- Retail premises: +0.66%
The continued rise in apartment rents highlights strong tenant demand across the residential sector, particularly in urban centres and employment hubs.
Property yields remain stable
Rental yields remained largely unchanged when compared with the same period a year earlier, indicating a balanced relationship between property values and rental income.
Year-on-year yield changes:
- Apartments: -0.05%
- Houses: -0.02%
- Retail: -0.01%
- Warehouses: -0.03%
- Offices: -0.01%
- Holiday apartments: -0.09%
- Holiday houses: +0.01%
While yields edged slightly lower in most sectors, the movements were minimal, suggesting that Cyprus property investments continue to offer relatively stable returns despite ongoing price growth.
Commentary
On behalf of KPMG in Cyprus, Christophoros Anayiotos, Board Member and Head of the Real Estate Industry Group, stated:
“During the first quarter of 2026, Cyprus’ property market remained broadly stable, with generally marginal price movements across most districts and asset categories. Apartments continued to be in the lead, particularly in Paphos and Famagusta, which recorded the highest increases, while Nicosia and Limassol showed only modest changes. Housing values experienced selective growth, with uplifts observed mainly in Famagusta and Limassol, and little movement elsewhere. Retail values were largely flat, with minor gains in Limassol and Famagusta, but with a slight decline in Paphos, while Warehouses and Offices showed small gains only in Nicosia and Paphos.
“Rental values continued to grow, with apartments posting the largest annual increases, followed by solid increases in offices and houses. Retail remained again the weakest performer, showing the smallest yearly change.
“Overall, the quarter reflects a stable market environment, with residential and office assets maintaining momentum, while Retail continued to demonstrate limited demand”.
On behalf of RICS, Simon Rubinsohn, RICS Chief Economist, commented:
“Although the Cypriot economy has been performing well, concerns are growing about the impact of the war in the Middle East, both directly on energy costs as well as on tourism. This uncertainty has been captured to an extent in the latest feedback to the RICS Cyprus Commercial Property survey with sentiment dipping in both the occupier and investor markets. This has yet to be reflected in the RICS Cyprus Property Price Index with KPMG in Cyprus but the longer the current troubles persist, the greater the risk that the shift in the mood music will begin to be visible in the hard data”.
Further reading
The full publication can be found on the RICS website at RICS Cyprus Property Index with KPMG in Cyprus.
SOURCE: Cyprus Property News