Apartment construction set for boom as building permits surge

Limited property supply combined with strong demand remains a key driver of rising prices in Cyprus, according to market professionals.

The arrival of large numbers of foreign workers and students, along with stronger domestic demand, has created new pressure on the housing market.

Increasing and upgrading the housing stock is therefore seen as central to easing the situation and bringing prices down.

Recent data from the Statistical Service on building permits, together with proposals by the Cyprus Scientific and Technical Chamber (ETEK) for the new local plans, provide indications of how the market could develop in the coming years.

In April 2026, 639 building permits were issued, representing a 10.7% increase compared with April 2025. The permits had a total value of €413 million and covered 335,300 square metres. They are expected to result in the construction of 1,728 residential units.

Between January and April 2026, 2,915 building permits were issued, compared with 2,157 during the same period last year, an increase of 35.1%.

The total value of the permits rose by 46.1%, while the total area increased by 45.5%. The number of residential units rose by 65%.

Apartment construction surges

The biggest increase was recorded in apartment developments.

According to the Statistical Service, 5,184 residential units in apartment buildings were approved during the first four months of 2026, compared with 2,789 during the corresponding period in 2025.

This represents an 85.9% increase.

The figures indicate that a large number of new apartments are expected to enter the market, strengthening Cyprus’ housing supply and potentially helping to meet demand and ease price pressures.

The Government is also seeking to increase the number of homes available through its affordable housing scheme, which is being developed by the Cyprus Land Development Corporation.

Mixed-use apartment buildings also recorded a significant increase, with 291 units approved during the first four months of 2026 compared with 162 in the same period last year, an increase of 79.6%.

The increase was more moderate for houses and semi-detached homes.

The number of units in detached houses rose to 1,237 from 1,003, an increase of 23.3%, while semi-detached housing units increased to 419 from 367, or 14.2%.

More plots being prepared for development

Another notable trend in the Statistical Service data concerns permits for road construction and plot division, which are typically an early stage in the development of new residential units.

Between January and April 2026, 270 permits were issued for plot division, compared with 157 during the same period in 2025, representing a 72% increase.

Permits for road construction rose to 66 from just 20, an increase of 230%.

The figures suggest that additional development capacity is being prepared for the coming period.

ETEK calls for more compact cities

The increase in construction is taking place as Cyprus reviews its local development plans.

ETEK completed and published its Strategic Planning Report for the Local Plans of Nicosia, Limassol, Larnaca and Paphos in January 2026.

Among its recommendations, ETEK proposes a transition towards more compact and polycentric cities, with clearly defined centres, sub-centres and neighbourhood centres, as well as development corridors and urban regeneration areas.

It also recommends strengthening mixed land uses and concentrating higher densities in areas with adequate infrastructure and accessibility, while avoiding horizontal expansion into undeveloped land.

Residential development and urban regeneration are identified as central priorities, with greater emphasis on activating and upgrading existing buildings and expanding affordable housing.

ETEK also calls for a combination of planning incentives with financial and administrative tools, as well as faster procedures for the reuse and upgrading of existing buildings.

Construction sector faces labour challenge

The importance of the construction sector to the economy was also highlighted in comments to the Cyprus News Agency by OEB Director General Michael Antoniou and CCCI Secretary General Philokypros Roussounides.

Antoniou said construction has traditionally been one of the engines of the economy and a key pillar supporting growth following periods of crisis or recession.

He said the building permit figures confirm that the property sector remains attractive to both Cypriot and foreign investors.

Higher construction activity is also contributing to increased housing supply and could provide “at least partial relief” from the housing problem, he said.

However, Antoniou identified the availability of workers as a major challenge, noting that the workforce currently available in Cyprus is insufficient to meet the sector’s needs.

Roussounides described the rise in building permits as positive for the economy, saying it demonstrates Cyprus’ resilience despite crises and geopolitical tensions.

He said the construction industry remains on a path of recovery and growth, while identifying bureaucracy and the need to strengthen digital transformation in both businesses and the public sector as key challenges.

He also highlighted licensing procedures as an area requiring attention.

Also read: Cyprus revises multinational minimum tax rules
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