A new €77 million housing policy unveiled by the Cypriot government aims to assist young couples struggling to afford property, but financing difficulties remain a key obstacle, according to industry experts.
The high cost of housing, coupled with stagnant wages, is pushing many young Cypriots towards loans to achieve homeownership. Kyriacos Kiliaris, Chief Marketing Officer at Danos, highlighted the significant impact on young couples.
The government’s policy offers various measures including housing allowances, a “Renovate-to-Rent” scheme, and initiatives promoting urban development and affordable housing. However, the challenge of securing financing persists.
Data from the Ministry of Labour and Social Insurance reveals an average gross monthly salary of €2,200 for men and €1,800 for women. Considering young couples seeking to buy homes are typically aged 25-35, their combined income would likely be lower, around €3,000 per month.
Market data indicates a new 200 sq.m. property in a suburb costs at least €400,000. This excludes taxes, furniture, and other necessities.
A 25% down payment for such a property would be €100,000, requiring a €300,000 loan. At a 5% interest rate over 25 years, the monthly payment would be roughly €1,850 – almost two-thirds of the couple’s combined income.
This scenario assumes a down payment. If they borrow the full amount, the monthly installment rises to €2,400.
