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Property market predictions for 2016



Property market predictions for 2016

The European Commission and the IMF forecast that the economy in Cyprus will remain positive in 2016, the projections as illustrated below in Graph 1, include a GDP growth rate, reaching 1,86% in 2016 and then 2,35% in 2017. The Fund marginally upgraded its economic growth projection for 2016 from 1.4% to 1.8%. It notes that in the period 2017-2020 growth is projected to average at 2% of GDP.

The improvement is raising optimism for the sector as both domestic and foreign demand appears to be gaining momentum. The stabilization of the economy and the light improvement in the labour market are also benefiting the sector. In the market there are expectations for an improvement in sentiment following government moves to reduce transfer fees, the promotion of planning incentives and the issuance of title deeds for delayed property buyers. Interest rate cuts by banks also had a positive contribution.

Experts also predict that the transactions in the property market will remain concentrated on prime assets by overseas buyers, encouraged by the government’s Naturalisation Schemes that focus on high-end residential properties. The investors are mainly interested in the freedom of travel, European education opportunities and producing income from their investments, therefore premium real estate can expect to see a continual development and increase in demand.

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