The floor area of flats licensed in Cyprus has risen by 1,112 per cent in a decade, while the total area of new detached houses has grown by about 56 per cent, an analysis by Phileleftheros shows.
The figures point to a market split in two, according to the analysis: mass construction of flats that is driving the economy and absorbing demand for housing, student accommodation and rental investment, and a shrinking share of detached houses that are becoming a luxury product for a few.
In the first half of 2016, flats were a small, secondary market, with just 124,720 square metres licensed across Cyprus. In 2026, the figure reached 1.51 million square metres.
The number of new detached houses rose only slightly, from 1,466 in 2016 to 1,760 in 2026, but their average size jumped from 170.5 square metres to 222.2. Their total floor area reached 391,000 square metres in 2026.
The analysis attributes the rise in size to higher building material costs and land prices, which it says have pushed the middle class out of the market for detached houses.
In 2016, it says, middle-class buyers were still building small and medium-sized houses of 140 to 160 square metres on the edges of towns, taking advantage of cheap land after the crisis.
Today, those who build are mainly demanding buyers on middle to high incomes, Cypriot and foreign, who put up large luxury villas of more than 220 square metres.
With the mortgage rate at 3.24 per cent, the cost of building a house, including the land, means monthly repayments an average couple cannot afford, the analysis says.
Such couples are instead forced towards flats, where a lower purchase price keeps loan repayments manageable. The small increase in the number of new houses shows the market has reached a point of balance.
The average size of a flat fell slightly over the decade, from 180 square metres to 174.4, a figure that is still high. This is because of two reasons.
The first is the rise of mixed-use buildings, with shops or offices on the ground floor and flats above. These were almost non-existent in 2016, accounting for just 12,859 square metres. In 2026, the number of homes in mixed-use buildings rose by 410 per cent to 837.
The second is a shift towards premium flats. In 2016, flats were built mainly as an affordable option for students and young couples, so small units dominated. In 2026, the market is driven by foreign companies setting up headquarters, whose executives look for large luxury flats with three or four bedrooms or premium penthouses.
