Housing in Cyprus continues to rise faster than household incomes

The real estate market in Cyprus continues to show rising prices amid the wider European housing crisis. According to Eurostat data, housing prices on the island in the fourth quarter of 2025 increased by 6% compared with the same period last year, exceeding the EU average of 5.5%.

Rising housing and rental costs are becoming one of the main social problems in eurozone countries. According to Eurostat, from 2015 to 2025 the average cost of housing in the European Union increased by 60%, far outpacing wage growth. In many European regions, rent already exceeds 40% of average household income.

Housing affordability is also worsening in Cyprus. The ratio of property prices to household income rose by 0.6%, while the EU average fell by 1.7%. Experts note that this index reflects the number of years an average household would need to buy a standard home.

At the same time, investment in the housing sector in Cyprus remains among the highest in Europe. In 2025, housing accounted for 40.8% of all investments in the country — significantly above the EU average of 23.5%.

Eurostat also points to a general shortage of affordable housing in Europe. Today, only 6–7% of the EU housing stock falls into the category of social housing. Against this backdrop, European countries are considering reforms in land use, short-term rental regulation and tax policy to stabilize the market.

In a number of countries, prices rose even more sharply than in Cyprus. In Latvia, housing prices increased by 11%, in Lithuania — by 10.8%, and in the Netherlands — by 6.2%. In Germany, the increase was 3%, in France — 1%, and in Italy — 4.1%.

Economists warn that further increases in property prices could intensify pressure on households and widen social inequality across EU countries.