The property market has been adjusting downwards for years, following unsustainable activity between 2004 and 2008. The market’s overheating revealed serious problems in legislation as well as with banks’ risk management that will take years to fix.

During the third quarter of 2013, prices in Nicosia and Limassol continued falling at a higher rate than other cities that were impacted earlier, RICS was quoted as saying by the Cyprus News Agency that got an advance copy of the report. Across Cyprus prices for houses fell by 1.0% and 2.7%, compared with the second quarter of the year. Compared with the same period last year, apartment prices across Cyprus fell by an average of 14.6% with houses’ prices dropping by 11.1%, shops by 20.2%, warehouse by 16.2% and offices by 13.2%. Compared with the previous quarter of the year, rent prices fell by an average of 5.2% for apartments, 5.4% for houses, and 12.0% for shops. Warehouses’ rentals fell by 7.1% and offices by 8.8%. In Famagusta, where prices have been falling for years, purchase prices and rents showed a marginal increase.

Properties’ initial gross yields – the percentage of annual rents to a property’s market value – continue to remain at low levels compared with abroad, RICS said.

Source: Cyprus  Mail