Attention from worldwide investors is now drawn to Northern Cyprus. Despite being "unrecognized," the Turkish Republic of Northern Cyprus (TRNC) is rapidly gaining popularity in terms of housing purchases. Unlike many countries currently facing high interest rates and recession, Northern Cyprus's real estate market is fairly independent of the global economic "winds" and continues to thrive. The past six months have seen a tremendous surge in demand: local realtors confirm that the demand for property purchases in TRNC has increased by 40–50% in just the first 6 months of 2023.
Both staying for extended periods and visiting TRNC for vacations are becoming increasingly convenient. The local Ercan airport has recently been renovated and upgraded, expanding its capacity. Several dozen flights arrive in Northern Cyprus daily; issues with electricity supply and mobile internet quality have almost been resolved.
And one shouldn't overlook the positive economic forecast: Unlike many countries grappling with high interest rates and recession, Northern Cyprus has demonstrated a different economic trajectory. Stable economic conditions and a favourable investor policy create a conducive environment for investments in real estate in Turkey, attracting both local and foreign buyers and driving up prices.
These factors collectively contribute to rising property prices in Northern Cyprus, making it an attractive market for both investors and homeowners. Another reason is the high rental income due to the swiftly growing demand; currently, for short-term rentals, the average occupancy of rented residences has increased from 200 to 230–250 days a year (and this is just an "average"; high-quality properties with good renovations in prime locations near the beach are rented out almost continuously).
So, thoughtful buyers are purchasing not just one but two or three apartments in Northern Cyprus; and Turkish developers are also trying to "tap into" this market with new development projects in Turkey.
PRICES AND DYNAMICS
Now, let's talk about real estate prices. For comparison, we'll provide figures for the first and second quarters of 2023, presented by analysts from 101evler – the leading specialised platform in this region.
However, experts clarify that in some particularly sought-after locations, the cost of housing can be significantly higher than the indicated "average," especially in places like Kyrenia.
FIRST QUARTER
So, here are the indicators for the first quarter (January–March) of 2023:
Apartments for sale:
| Quarterly dynamics | Average cost per sq. m (£) | Average investment return period | |
|---|---|---|---|
| Overall in TRNC | +10,27% | 911,16 | 15,6 years |
| Nicosia | +7,27% | 625,84 | 13,7 years |
| Kyrenia (Girne) | +11,36% | 1,157,71 | 15,5 years |
| Famagusta | +11,69% | 750,76 | 16,9 years |
| Iskele | +11,46% | 1,431,34 | Data not provided |
Villas for sale:
| Price change for the quarter | Average cost per sq. m (£) | |
|---|---|---|
| Overall in TRNC | +11,33% | 1,238,74 |
| Nicosia | +11,44% | 847,33 |
| Kyrenia (Girne) | +11,25% | 1,434,42 |
| Famagusta | +11,49% | 988,43 |
Rental rates:
| Price change for the quarter | Average cost per sq. m (£) | |
|---|---|---|
| Overall in TRNC | +11,57% | 4,86 |
| Nicosia | +11,65% | 3,81 |
| Kyrenia (Girne) | +11,51% | 6,22 |
| Famagusta | +11,51% | 3,7 |
Summary and conclusions:
- The range of the average cost per m for apartments is between £1,700 and £2,200; while the rates for villas start from £2,000 per sq. m and go upwards.
- The prices of residential properties in Northern Cyprus steadily grew in the first quarter, averaging a 10% increase; with apartments rising by 10.27% and villas by 11.33%. Rent rates saw an even larger hike, with an average countrywide increase of 11.57%.
- With respect to rental apartments, Nicosia saw the highest growth in the last three months at 11.65%. In the first quarter of 2023, apartment sale prices in Nicosia increased by 7.27%. Meanwhile, the average cost per m was £625.84, with a payback period of 13.7 years.
- For villas, the highest average price per m was noted in Kyrenia (Girne), with a price surge of 11.44% over the last three months. Recent data indicates that the average price of villas in this region is £847.33 per sq. m.
- Prices for both villas and apartments in Kyrenia witnessed significant growth. Villa prices soared by an exaggerated 1,434.42% (please note there seems to be an error or misunderstanding in this percentage, and it's likely a mistake); averaging £11.25 per m. Apartment prices in Kyrenia increased by 11.36%, averaging £1,157.71 per sq. m.
- Moving to Famagusta, the sale prices for apartments increased by 11.69%. The average cost per m for apartments in this area is £750.76, with a return on investment period of 16.9 years. Similarly, the rental rates for apartments in Famagusta rose by 11.51%, averaging 3.7 Turkish lira per sq. m. The sale prices for villas in Famagusta went up by 11.49%, with the average price being £988.43 per sq. m.
- In the docks (possibly referring to the area of Iskele), the sale prices for apartments increased by 11.46% over the last three months. The average cost per m in Iskele is £1,431.34.
SECOND QUARTER
The prices for the second quarter were published at the end of July. Analysts from REIDIN Data Analytics also contributed to the data assessment.
Metrics for the second quarter (April–June) of 2023:
Housing sale (Apartments)
| Apartments | Price change over quarter | Avg. price per sq. m (£) | Investment return period (years) |
|---|---|---|---|
| Country average | 10.2% | 1,004,13 | 15,9 |
| Nicosia | 8,89% | 681,46 | 13,9 |
| Girne | 10,33% | 1277,3 | 9,34 |
| Famagusta | 11,62% | 838 | 11,42 |
| Iskele | 11,19% | 1,591,48 | Data not provided |
Prices of villas for sale
| Villas | Price change over quarter | Avg. price per sq. m (£) |
|---|---|---|
| Country average | +8,71% | 1,346,65 |
| Nicosia | +3,6% | 877,74 |
| Girne | +10,17% | 1,580,33 |
| Famagusta | +11,41% | 1,101,22 |
Rental rates
| Price change over quarter | Avg. price per sq. m (£) | |
|---|---|---|
| Country average | +8,69% | 5,28 |
| Nicosia | +7,03% | 4,07 |
| Girne | +9,34% | 6,8 |
| Famagusta | +11,42% | 4,12 |
Summary and conclusions:
Based on data for the second quarter, prices across Northern Cyprus for all types of real estate have increased.
The increase over 3 months is quite significant:
- On average for the country: by £90 (from £912 to £1,004),
- In Nicosia: by £55 (from £625 to £681),
- In Girne: by £110 (from £1,158 to £1,277),
- In Famagusta: by £90 (from £751 to £838),
- In Iskele: by a staggering £160 (from £1,431 to £1,591).
Famagusta saw the most notable price surge, at 11.42%. Apartments increased by 11.62%, with the average price per sq. m in the region being £838, and the payback period being 16.9 years.
The highest average price per region for one sq. m is in Kyrenia: villas increased by 10.17% to £1,580.33 per sq. m. Apartments for sale in Girne grew in price by 10.33% to £1,277.3, with a current payback period of 15.7 years.
The rental rate for apartments in Kyrenia jumped in price by 9.34% over the last 3 months. According to the data for the second quarter of 2023, the average rental price per sq.m is £6.8, and the payback period for an investor in this area is 15.7 years.
Apartment sales in Iskele increased by 11.19%. The average price per sq. m for apartments listed for sale is £1,591.48.
Apartment prices in Nicosia grew by 8.89%, with the region's average price per sq. m being £681.46, and the return on investment period by mid-2023 is 13.9 years; in terms of price, this is the most affordable region, but it also offers the quickest return on investment. Apartment rentals in Nicosia increased by 7.03% over the past 3 months, with an average rent price per sq. m being £4.07.
Villa prices in Nicosia saw the smallest growth for the quarter at 3.6%. The average price per sq. m here is below the market average at £877.84.