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- Housing measures will receive more than €70 million, including €32.5 million for schemes and €70 million for 460 affordable rental homes.
- The government will allocate €20 million in 2027 to housing schemes for mountainous, remote and disadvantaged areas, rural communities and young people.
- Refugee housing policy is budgeted at €85.7 million, while the “κτίΖΩ” scheme is set to rise to €16 million in 2027.
- State grants to local authorities are expected to reach about €186.5 million in 2027, with €38 million earmarked for major infrastructure projects.
Cyprus has allocated €780 million to the Interior Ministry for 2027, with housing support, refugee assistance and local government funding among its main priorities.
Interior Minister Constantinos Ioannou presented the budget and the 2027–2029 Medium-Term Fiscal Framework to the House Finance and Budget Committee on 9 November.
The proposed budget is €1.5 million higher than the ministry’s initially approved budget for 2026 and €110.5 million above its actual expenditure in 2025. Expected revenues stand at €246.3 million.
Development expenditure accounts for €263.5 million, or 33.1% of the total, while recurrent expenditure amounts to €517.4 million, representing 65%.
The largest spending areas include state grants to local authorities and other organisations, housing subsidies and schemes, and funding for co-financed projects and works under construction.
The ministry expects to implement at least 85% of its 2026 budget. Excluding expenditure by the Directorate of European Funds, implementation during the first ten months of 2026 was almost 7% higher than in the same period of 2025.
€70m-plus investment in housing
Housing remains one of the ministry’s main priorities, with its policy focusing on increasing the number of available homes and helping people afford to buy property.
More than €70 million is expected to be invested in housing measures in 2027. This includes:
- €32.5 million for housing schemes.
- An estimated €22 million from the use and purchase of building density through planning incentives and the Build to Rent scheme.
- 523 plots of state land, with an estimated value of €17 million, to be offered to families.
A major project involves the construction of 460 affordable rental homes on state-owned land in the Nicosia, Limassol, Larnaca and Paphos districts. The project has a budget of €70 million and is being promoted for EU co-financing.
Construction is scheduled to begin in December 2027, with completion targeted for April 2031.
Other measures include the Renovate-Rent scheme, which aims to bring existing homes into the rental market, and plans to build shared accommodation and student housing.
The ministry also highlighted changes to the building permit process. Around 3,000 permits for detached and semi-detached houses have been issued within 40 working days, while more than 1,400 permits for apartment buildings with up to 20 units have been issued within 80 days.
A new scheme will also allow homeowners to add an extra floor or extend existing homes, helping families accommodate relatives while making better use of residential land.
€20m for young people and families
The government will allocate €20 million in 2027 to housing schemes supporting people in mountainous, remote and disadvantaged areas, as well as rural communities. This is an increase of €5 million.
Between 2019 and September 2026, 2,400 applications under these schemes were approved, with total financial support reaching approximately €91 million.
A separate scheme offering financial assistance to young people and couples under the age of 41 has supported 700 beneficiaries, with expenditure totalling €26 million. The ministry intends to relaunch the scheme for a specific number of applicants.
Under the state land allocation scheme, 523 plots are expected to be made available to families in 2027 at 25% of their general valuation.
€85.7m for refugee housing support
The Interior Ministry has allocated €85.7 million for refugee housing policy in 2027. Funding for the three-year period from 2027 to 2029 is expected to reach €245.3 million.
The money will cover housing grants, rent subsidies, repairs to Turkish Cypriot properties and improvements to government housing estates and self-housing settlements.
The government will also continue the “κτίΖΩ” scheme, which has a total budget of €105 million across its three phases. Its allocation is expected to rise to €16 million in 2027, compared with €11 million in 2026 and €7 million in 2025.
Revised and simplified housing schemes have increased the number of eligible beneficiaries by 15% and accelerated application processing. A total of €42.6 million is earmarked for these schemes in 2027, while the ministry is also reviewing rent subsidy criteria.
Refugees eligible for housing schemes in mountainous, remote and disadvantaged areas will receive a grant that is 20% higher.
The ministry is also working to issue title deeds and lease certificates in more than 1,600 cases, addressing long-standing outstanding issues in refugee settlements.
€186.5m in grants for local authorities
State grants to local authorities are expected to reach approximately €186.5 million in 2027. A further €10 million is earmarked for development projects in municipalities.
Over the full 2027–2029 period, grants to local authorities in government-controlled and occupied areas, including municipalities, communities and district local government organisations, will exceed €560.2 million.
More than €44 million will also be invested in rural development projects and infrastructure in 2027 through district administrations and the Department of Town Planning and Housing.
The ministry said it was also promoting the use of European and national funding, amounting to €3.5 billion, for projects in villages across all districts.
€38m for infrastructure and planning projects
A total of €38 million is earmarked for major infrastructure projects across Cyprus in 2027.
These include road works in the Tseri and Argyroupoli areas of Nicosia, the Larnaca–Dhekelia coastal road, the Deryneia–Sotira connection and projects on Limassol’s second ring road, as well as urban regeneration schemes in municipalities and communities.
The ministry is also proceeding with revisions to the local plans for Nicosia, Limassol, Larnaca and Paphos.
Changes to the legal framework governing listed buildings are also planned, alongside simpler procedures for transferring building density and the creation of a digital register to improve transparency.
€17.8m to strengthen civil protection
The 2027 budget includes €17.8 million for civil protection.
Plans include establishing a National Civil Protection Mechanism and appointing a National Coordinator to improve planning and coordination between the relevant services.
The ministry will also continue updating national emergency plans and upgrading the CY-Alert early warning system and the new NG112 emergency communications system.
Further measures include modernising sirens and shelters and strengthening emergency equipment and supplies, with an emphasis on prevention, preparedness and protecting lives and property.
European funding of €662.9m
European funds remain an important source of financing for the ministry’s policies and development priorities.
For the 2021–2027 programming period, total public expenditure is estimated at €662.9 million, including €496.8 million from European funds.
Presenting the budget, Ioannou said the ministry’s priority was to complete reforms and projects already under way, address operational problems and assess the effectiveness of existing policies.
He said the aim was to ensure that public spending produced tangible results for society, with citizens at the centre of the ministry’s work.
Also read: Cyprus’ EEZ holds an estimated 20 trillion cubic feet of natural gas resources
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