The Interior and Finance Ministries are preparing to tap into the European Investment Bank’s newly announced €10 billion housing initiative to address the island’s growing housing affordability crisis.
The move comes as the European Investment Bank (EIB) unveiled its pan-European investment platform for affordable and sustainable housing on Thursday, pledging to double its housing funding to €6 billion by 2026, with total investments reaching €10 billion in 2025 and 2026.
The Interior Ministry intends to initiate dialogue with the EIB to clarify the operational framework of the announced platform and develop a proposal to utilise European funds.
Housing affordability has become a pressing issue in Cyprus, mirroring trends across Europe where housing prices have increased by 50% and rents by 25% over the past 15 years, according to European Commissioner for Energy and Housing Dan Jørgensen.
Officials are considering three funding scenarios, including an interest subsidy scheme for new housing construction under an affordable housing programme, direct financing of residential projects that allocate units for affordable housing, or initiatives led by the Cyprus Land Development Corporation (CLDC).
The government recently announced changes to its housing policy and reportedly sees EIB’s initiative as an opportunity to address local housing challenges with European support.
The initiative comes as part of the EIB’s response to housing shortages affecting millions across Europe, with EIB President Nadia Calviño noting that the EU needs an additional one million new homes annually while another five million require renovation to improve energy efficiency.
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