Buyers Guide: Investing in Off-Plan Properties in Cyprus

As the real estate market in Cyprus continues to thrive, investing in off-plan properties has emerged as one of the most strategic and rewarding approaches.

At SQONE, we understand the dynamics of the Cypriot property market, and we've seen firsthand how investors can capitalize on early-stage opportunities.

This guide dives into everything you need to know about off-plan investments in Cyprus, why it's a smart move, and how you can maximize your returns in 2024.

What Is Off-Plan Property Investment?

Off-plan property investment involves purchasing a property during the construction phase or even before the development has begun. This allows investors to secure properties at pre-market prices, offering significant financial advantages.

The potential for capital appreciation and flexibility in design are just a few reasons off-plan investments are gaining traction in Cyprus.

Why Invest in Off-Plan Properties in Cyprus?

Cyprus is currently one of the most attractive markets for off-plan investments, thanks to its strong economic growth, high rental demand, and strategic location in the Mediterranean.

At SQONE, we believe 2024 is the perfect year to explore these opportunities, and here’s why:

1. Early-Bird Price Advantage

The primary benefit of buying off-plan is the ability to secure a property at a significantly lower price than completed developments.

Developers typically offer discounts of 10%-30% below market value to attract early buyers and secure funding for the project. This provides immediate capital gains as the property appreciates during construction.

For example, a property valued at €300,000 upon completion might be available for €240,000 in the early stages of development. By the time the project is ready for occupancy, you’ve already gained €60,000 in equity, giving you a head start in the market.

2. Capital Appreciation During Construction

Cyprus’s real estate market is experiencing sustained growth, particularly in high-demand areas like Limassol, Paphos, and Nicosia.

Property prices have risen by over 30% in the last three years, and this trend is expected to continue in 2024.

By investing off-plan, you benefit from capital appreciation throughout the construction phase, potentially earning returns of 10%-20% even before the property is ready for rental or sale.

3. Customizable Options

Off-plan investments provide the flexibility to tailor the property to your preferences. Whether it's selecting premium finishes, altering the interior layout, or choosing features that will appeal to future renters, buying off-plan allows you to influence the final design of the property.

This customization not only enhances the property’s market value but also attracts higher-end tenants, improving rental income potential.

4. Strong Rental Demand

Cyprus is currently experiencing high rental demand due to its booming tourism industry, growing expat community, and a flourishing digital nomad scene. Cities like Limassol, Paphos, and Larnaca have become hotspots for tourists, professionals, and students, all seeking short- and long-term rental properties.

For investors buying off-plan, this means you’ll be entering a high-demand rental market by the time your property is completed.

Rental yields in Cyprus can range from 4%-8%, depending on the location and type of property. Off-plan developments in premium areas tend to command higher rents due to their modern designs and prime locations.

5. Flexible Payment Structures

Another key advantage of off-plan investing is the flexible payment plans offered by developers. Unlike purchasing a completed property where full payment is typically required upfront, off-plan buyers can spread their payments over the course of construction. Payment schedules might look like:

• 10%-20% deposit upon signing
• Several smaller payments tied to construction milestones (foundation, structural completion, etc.)
• Final payment upon completion and handover

This phased approach eases the financial burden on investors, allowing them to manage cash flow while securing a high-potential asset.

6. First Choice of Units

When buying off-plan, you typically get the pick of the best units in a development. Whether it’s a penthouse with a sea view or a corner unit with extra square footage, early investors have access to properties with premium features.

These units often sell at higher prices once the development is completed, giving you a significant first-mover advantage when it comes to resale or rental.

7. Attractive Tax Incentives

Cyprus offers some of the most investor-friendly tax policies in Europe, making it a prime location for property investment. By investing off-plan, you could benefit from:

• Reduced VAT on new residential properties (as low as 5% for eligible buyers)
• No inheritance tax
• Low property taxes
• Potential Permanent Residency benefits for non-EU investors who meet the investment threshold of €300,000 or more.

These tax benefits not only enhance your profitability but also make Cyprus a low-risk, high-reward market for international investors.

Key Locations for Off-Plan Investments in Cyprus

Selecting the right location is crucial when investing in off-plan properties. Here are the top areas we recommend at SQONE for 2024:

1. Limassol

Limassol continues to be Cyprus’s financial hub and a magnet for both expats and tourists. With high rental demand, especially in the luxury sector, off-plan developments in areas like the Limassol Marina, Neapolis, and the beachfront offer high rental yields and excellent capital appreciation potential.

2. Paphos

Paphos is renowned for its cultural heritage and picturesque coastline, making it a popular destination for holiday rentals. Off-plan developments in the city center and along the coast are ideal for investors targeting the tourism market.

3. Nicosia

As the capital and business hub, Nicosia attracts professionals, students, and expats, creating a consistent demand for rental properties. Off-plan properties near universities and business districts provide stable, long-term rental income.

4. Larnaca

Larnaca is an emerging investment hotspot, thanks to new infrastructure developments and its proximity to the island’s main international airport.

Off-plan developments along the revitalized waterfront and city center offer strong potential for both short-term rentals and long-term capital gains.

Conclusion: Why Off-Plan is the Way Forward in 2024

At SQONE, we see off-plan properties as one of the most lucrative investment opportunities in Cyprus for 2024. The combination of early price advantages, flexible payment structures, strong rental demand, and long-term capital appreciation makes off-plan a strategic move for both first-time investors and seasoned property buyers.

Our growing portfolio of off-plan developments offers an exceptional range of opportunities, with 9 current projects under construction and 9 off-plan projects available for purchase.

These include luxury studios, 1-2 bedroom apartments, and stunning penthouses, perfect for investors looking to secure prime real estate. Apartments are available to invest in from €178,000, offering incredible value in a thriving market.

Partner with SQONE today for expert guidance and exclusive access to the best off-plan opportunities in Cyprus.