Since the launch of Cyprus’ new affordable housing initiatives last year, the country has seen over 560 applications, signaling a clear increase in demand for accessible housing solutions. This surge is predominantly driven by young individuals and couples eager to secure state assistance to navigate the challenging real estate market.
Addressing parliamentary inquiries, Interior Minister Constantinos Ioannou revealed that 525 applications were submitted under the housing grant aimed at young people and couples aged up to 41. Out of these submissions, 152 have been approved, successfully unlocking €5.4 million in financial aid. Meanwhile, 172 applications were turned down, one was withdrawn, and 200 remain under review.
In addition, 43 applications were received for the Renovate-to-Rent scheme. So far, 28 applications have been approved with funding allocated at around €727,000, six are pending, and nine have been rejected. These measures are not only intended to support families but also to alleviate overall pressure within Cyprus’ housing sector.
Minister Ioannou emphasized that these initiatives aim to increase the housing supply to better meet demand, ultimately softening purchase prices and rental costs. Although the impact is still unfolding, plans involving planning incentives, Build to Rent programs, and developments by the Cyprus Land Development Corporation (KOAG) are expected to introduce a significant number of new homes in the coming years.
The private sector is actively joining the effort. Seven developers have agreed to buy out their urban development factors, contributing approximately €5 million towards affordable housing funding. KOAG itself has inked 16 agreements with private companies, amounting to 84 homes: 65 designated for sale and 19 for affordable rent.
In 2023, KOAG completed 16 homes for sale and is currently constructing 24 more, with delivery slated for 2025. Future projects include 135 homes for sale and 36 for rent starting next year, followed by 96 homes for sale and 156 rental units planned for 2026. All units aim to hit the market by 2027, after which KOAG will reassess future strategies based on demand and available resources.
In Larnaca, KOAG is developing the Ianthi project, a 24-apartment complex set for completion by September 2025. Six units have already been sold, with 16 still available. Plans also include constructing 16 additional apartments on an adjacent plot, with budget provisions for 2026.
KOAG has also partnered with developers to deliver 39 affordable units in the district, further expanding options for residents.
In Limassol, groundbreaking has begun on the island’s first dedicated affordable rental housing development. This initiative, in collaboration with the local municipality, will offer apartments with rents 25–30% below market rates. It is part of a broader €100 million plan to provide approximately 600 units across the Ayios Nikolaos and Ayios Ioannis neighborhoods.
The initial phase in Ayios Nikolaos includes four six-story buildings comprising 138 apartments, with KOAG managing 94 units and 44 allocated to the municipality. This phase alone carries a budget exceeding €22 million and represents KOAG’s first direct cooperative project with a local authority.
Additional affordable housing schemes are underway across the island. Currently available three-bedroom units in the Ekali project in Kaimakli and ongoing construction in Kokkinotrimithia aim to meet growing demand.
By the end of 2025, KOAG plans to start new developments totaling 135 homes in areas such as Pano Polemidia, Ayios Dometios, Lakatamia, Palouriotissa, and Kaimakli, along with 10 homes in Kokkinotrimithia.
For those exploring affordable property options, consider browsing Cheap Apartments for Sale Cyprus or Cheap Houses and Villas for Sale Cyprus on INDEX.cy to find opportunities that fit your budget.
While these efforts signify positive steps toward expanding affordable housing, the real estate market in Cyprus continues to face evolving challenges. By closely monitoring these developments, prospective buyers and renters can make more informed decisions in a market where supply and demand are gradually balancing.
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