Insider Economy Rents in Cyprus take off

Rents in Cyprus take off

Rents in privileged areas of cities have risen by as much as 70% over the past five years, according to a study carried out by a private company on behalf of the government.

In Paphos, the increase in rent for apartments and houses reached 68%, in Limassol it was 57.5% and 45% in the capital of Nicosia. In Larnaca rentals rose by 42.9% and in Famagusta by 5%.

The study was conducted so as to update data. It will also be used to review the amount provided by the state as rent allowance or mortgage loan interest under the Minimum Guaranteed Income (MGI) scheme. The previous study was carried out in 2014. Beneficiaries of MGI will be allowed to apply for rent allowance.

As part of a new housing policy announced by the government last month, a rent subsidy which is set at 70% of the average price in order to exclude excessively high prices that affect the average. Based on the 2019 study, the rent subsidy is expected to be as follows:

– In Nicosia, the allowance for a two-bedroom apartment will be €324.80

– In Limassol, the allowance for a two-bedroom apartment will be €352.80

– In Larnaca, the allowance for a two-bedroom apartment will be €280

– In Paphos and Famagusta, the allowance for a two-bedroom apartment will be €235.20.

The monthly cost of providing a housing allowance under the MGI provision is estimated to rise to €1.13 million from €759,000.  In addition, the annual expenditure will increase by €4.5 million and reach €13.6 million.

The study is linked with regulations submitted by the Ministry of Labour, under which a rent allowance is adjusted to the new levels as recorded in the latest study on increased rentals.

Opposition Akel MP Stefanos Stefanou said the government announced a new housing policy a few days before the recent European elections, but it’s highly doubtful that this will ever be implemented.

“We hope the government won’t apply its well-known tactic on policies, that is make them just before an election and forget all about them the day after the election,” he added.


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