The long-standing advantage of renting being cheaper than buying a home is fading fast in Cyprus. Increasingly, monthly rent payments are rivaling or surpassing mortgage installments, prompting many households to reconsider their housing choices.
Interior Minister Konstantinos Ioannou, responsible for the government’s housing initiatives, highlighted this trend in a recent parliamentary exchange with DIKO MP Christos Senekis. According to the Minister, fewer displaced persons are applying for rent subsidies while a growing number are opting for government-supported schemes that facilitate home purchases or construction.
The statistics support this shift: applications for rent subsidies fell from 4,509 in 2022 to 3,155 in 2024, signaling a clear decline. Meanwhile, demand for home ownership assistance has climbed steadily, closely linked to the upward pressure on rental prices.
Minister Ioannou explained that, over the past three years, there has been a consistent drop in rent subsidy requests alongside a rise in applications for buying or building homes. With rents surging, many Cypriots find mortgage repayments comparable to rent, making purchasing a more attractive and potentially stable option.
To alleviate strain on renters, subsidy amounts were increased by approximately 15% starting January 2024. Despite this, the persistent rise in rent underscores the urgency to enhance state housing support programs focused on home ownership.
One key initiative is the ongoing Ktizo housing scheme, designed to assist displaced persons with a budget approaching €130 million over ten years. Since 2013, eligibility criteria broadened to include children of refugee mothers, increasing the population qualifying for assistance and reflecting evolving social realities.
MP Senekis also raised concerns about outdated income limits for the Rent Subsidy Scheme, which have not been adjusted in over 15 years. Minister Ioannou confirmed that reforms are underway, with the Welfare Service submitting a draft bill to reform subsidy rules. This bill proposes measures such as repealing certain rent control provisions, appointing a dedicated Rent Subsidy Officer, introducing an appeals process, and updating evaluation criteria to ensure fairness and wider coverage.
Upon approval, revised income thresholds and assessment methods will be presented to the Council of Ministers. The ultimate goal is to make subsidies more accessible and equitable for those in need.
Regarding budget utilization, rent subsidy funds have been largely exhausted annually, with average usage above 90% over the last three years (93.54% in 2022, 93.76% in 2023, and 85.39% in 2024). Unspent funds are redirected to other housing support programmes, such as grants for purchasing, building, or renovating homes, which frequently face demand exceeding the allocated budget.
For those looking to enter the property market amidst these changes, exploring options like Cheap Houses and Villas for Sale Cyprus can provide affordable pathways to home ownership. Whether you’re aiming to rent or buy, understanding Cyprus’s housing landscape and government support schemes is essential in making an informed decision.
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