Unlike many other countries that are currently facing high (sometimes extremely high) bank interest rates on consumer and home loans, mortgages, as well as an economic recession, Northern Cyprus real estate market continues to develop thanks to stable demand, quality supply, and limited availability of land for development.
Turk Estate has already discussed many aspects of buying a property and doing business in Northern Cyprus – check the list of materials at the end of this article – and now it's time to discuss the "present" and "future." First, when it is about particular numbers (statistics) – time. And second, why investing in Northern Cyprus real estate not only brings you profit but also allows you to achieve a very happy retirement lifestyle.
Content:
- Statistics and numbers
- Q1 2023 (January-March)
- Five reasons why house prices rise rapidly
- The interest of foreigners and a comfortable pension
- And finally, regarding infrastructure and other significant aspects of life in Northern Cyprus:
- And here is what Turk.Estate has already wrote about Northern Cyprus:
Statistics and numbers
It should be noted that the data collected by the 101evler webpage is relatively new and only covers Q1 2023. As a result, the information below may not precisely reflect the year's patterns and current real estate values. Analysts, relying on their experience and forecasts, promise that, for example, real estate prices in the Kyrenia region have exceeded the values designated as "indicative" in the analysis.
According to a recent survey, apartment prices in Northern Cyprus range from £1,700 to £2,200 per square meter (remember, prices in Northern Cyprus are in British pounds: a strong British "influence" remains here, and the TRNC – Turkish Republic of Northern Cyprus – remains a kind of "branch of Britain"). Villa costs begin at £2,000 per square meter.
(Note)
While considering the potential renovation costs associated with these types of properties is crucial, it is also worth noting that there may still be opportunities to find second-hand but decent quality residences at reduced prices.
Despite these considerations, the North Cyprus property market provides exciting chances for those seeking investment returns and looking to obtain their dream house for themselves and their families.
Q1 2023 (January-March)
Apartments for sale
| 3 month growth | Average price for 1 sq. m in the region | Return on investment | |
|---|---|---|---|
| Country's average level | 10.27% | £911.16 | 15.6 years |
| Lefkosia | 7.27% | £625.84 | 13.7 years |
| Kyrenia | 11.36% | £1,157.71 | 15.5 years |
| Farmagusta | 11.69% | £750.56 | 16.9 years |
| Iskele | 11.46% | £1,431.34 | – (no data) |
Apartments for rent
| 3 month growth | Average price for 1 sq. m in the region | |
|---|---|---|
| Country's average level | 11.57% | £4.86 |
| Lefkosia | 11.65% | £3.81 |
| Kyrenia | 11.51% | £6.22 |
| Farmagusta | 11.69% | £3.7 |
Villas for sale
| 3 month growth | Average price for 1 sq. m in the region | |
|---|---|---|
| Country's average level | 11.33% | £1,238.74 |
| Lefkosia | 11.44% | £847.33 |
| Kyrenia | 11.25% | £1,434.42 |
| Farmagusta | 11.49% | £988.43 |
As it can be seen, the average growth rate in sales and rentals, as well as sales in two categories (apartments and villas) is around 11%.
While apartment sales prices jumped by 10.27% in the first quarter of the year, rental rates increased by 11.57%. Despite the fact that the European economic crisis afflicted all countries, it did not appear to affect Northern Cyprus: prices for such expensive units as villas (!), which were already pricey, surged by 11.33%.
Nicosia recorded the biggest rise in rental units in the last three months, at 11.65%. Selling prices for flats in Nicosia climbed by 7.27% in Q1 2023, with an average price per square meter of £625.84 and a payback period of 13.7 years.
Kyrenia (Girne) has the highest average price per square meter for a villa, with an 11.44% increase in sales prices over the last quarter. The average cost of a villa in the area is £847.33 per square meter.
Prices for villas and apartments in Kyrenia rose significantly in both categories, by 11.25% and 11.36%, respectively. One square meter in the villa is around a quarter more expensive than square meter in the apartments: £1,434.42 versus £1,157.71.
Apartment prices in Famagusta increased by 11.69%. The average cost per square meter for apartments in the given area is £750.76, with a 16.9 year payback period. Similarly, Famagusta apartment rental costs went up by 11.51% to an average of £3.7 per square meter.
Villas in Famagusta grew in value by 11.49%, with the average price per square meter reaching £988.43.
Basic housing (apartments) for sale in Iskele climbed in price by 11.46% in the last three months. Iskele flats cost on average £1,431.34 per square meter.
In general, the North Cyprus property market has exhibited flexibility and expansion, with rising property values in many locations.
Simultaneously, compare the "return on investment" indication, which spans from 13 to fewer than 17 years – an indicator that only a few provinces of the Republic of Turkey can boast of.
Five reasons why house prices rise rapidly
- Demand for real estate is high in Northern Cyprus, which is the "locomotive" or driving force behind growing prices. This demand can be linked to a variety of factors, including advantageous financial opportunities, an appealing lifestyle, and the natural beauty of the place.
- Limited availability of zoning of lands: The supply of land appropriate for development in Northern Cyprus remains limited, making the construction of new properties difficult. This lack of suitable land creates an imbalance between supply and demand, putting a persistent downward pressure on property values.
Northern Cyprus has an area of approximately 3,355 square kilometers (1,295 square miles), of which approximately one-third is occupied by hills and another third is "reserved" for state lands and a road with connected road infrastructure. Furthermore, around half the remaining land is already in use, and some territory lacks essential infrastructure, roads, or planning licenses.
- Emerging rental market: Northern Cyprus's rental sector has also experienced a significant rise in the last three months, with apartment rental rates jumping by 11.57%. This tendency implies that there is plenty of demand for housing for rental, which contributes to the overall growth in rental rates.
- "Regional inequality." Different levels of price rises in Northern Cyprus's cities. Nicosia and Kyrenia, for example, had tremendous increase in both flats and villas.
These regional differences can be influenced by factors such as location, amenities, and infrastructure, all of which have varying effects on property values in different places.
- Positive economic forecast. As we mentioned at the beginning of the article, Northern Cyprus, unlike many other countries that are now facing high interest rates and recession, is very "resistant" to these processes: sufficient independence, stable economic conditions, and investor-friendly policies create a very comfortable – let's say, "encouraging" – environment for real estate investment, attracting both local and foreign investors. As a result, prices continue to grow.
All five of these factors work together to push up property values in Northern Cyprus, making it a desirable market for both investors and homeowners.
The interest of foreigners and a comfortable pension
Speaking about foreigners, who is now interested in buying property in Northern Cyprus?
Northern Cyprus was able to attract consumers from 72 different nations. At the same time, it took the lead as one of the "most expensive coastal states in the world" (and, according to Forbes research for 2021, it was the first most expensive destination), while also ranking fourth among "best places to live in retirement." In this list, it shares space with Colombia, Brazil, Mexico, and Belize.
Climate, nature, weather, infrastructure convenience...
Furthermore, Northern Cyprus possesses all of Turkey's advantages (apart from the nuances of obtaining a residency permit and citizenship, which are different here), while largely eliminating its negatives.
Specifically: noise, chaos where the Turks usually live: this noise amuses at first, but quickly annoys. The flexibility of utility services, that is, the call of a plumber/electrician services: eliminating the cause of any failure can occasionally turn into an adventure. And so forth.
Northern Cyprus is a "piece of Europe" with its culture, but it also has "Turkish" nature, the sea, a multitude of hotels, recreation possibilities, and so on.
And what is the outcome? In just six months, demand for residential property in Northern Cyprus has increased by 40–50%.
We notice that foreign investors are particularly interested in Kyrenia (Girne), Esentepe, and Iskele. In addition, the steady rise in the value of real estate and the land on which this property is built as well as the high profitability from renting, drive up demand.
In terms of rentals, there is no precise data on long-term rentals yet, but short-term apartments and villas are constantly "occupied" for 230–250 days every year. And that is on average; good options in desirable areas are considerably better for rent.
Additionally, in recent months, this figure has climbed by 15%, from 200 to 230 days.
And finally, regarding infrastructure and other significant aspects of life in Northern Cyprus:
- Ercan Airport is improving: it is expanding and increasing capacity;
- the authorities are paying close attention to the organization of a new social infrastructure, including recreation areas;
- problems with the supply of water are gradually being solved, which exist to some extent on the territory of the entire island of Cyprus (both the southern, "Greek" part, and the northern – "Turkish" part);
- with electricity, they also promise significant improvements in the very near future: an electric cable is being pulled from Turkey along the bottom of the sea, allowing the island to be supplied;
- soon, a system to provide residents and visitors to Northern Cyprus with much better Internet and telephone communications will be launched.
And here is what Turk.Estate has already wrote about Northern Cyprus:
- Real estate investment in northern cyprus: why you should choose this destination
- Advantages of investing in real estate in northern cyprus
- How to obtain a residence permit in northern cyprus by buying or renting property?
- Taxes on the purchase of property in northern cyprus
- Expenses when buying property in northern cyprus
- Purchasing property in northern cyprus
- Legal services when buying property in northern cyprus
- Opening a company in northern cyprus. basic requirements and registration procedure