Nicosia: The sharp rise in building permits is a positive sign for Cyprus' construction sector and the economy in general, Cyprus Employers and Industrialists Federation (OEB) and Cyprus Chamber of Commerce and Industry (KEVE) told CNA on Wednesday, while also pointing to strong demand and ongoing challenges facing the sector.
According to Cyprus News Agency, data released by the Cyprus Statistical Service on Tuesday highlighted a remarkable increase in building permits, with 2,915 permits issued between January and April 2026, marking a 35.1% rise from 2,157 in the same period last year. The total value of these permits increased by 46.1%, total area by 45.5%, and the number of housing units by 65%.
OEB Director General Michael Antoniou emphasized the historical significance of construction as a key driver of Cyprus' economy, noting that the latest figures indicate a continued attractiveness of real estate to both local and foreign investors. He mentioned the sector's pivotal role in increasing housing supply, which could alleviate housing pressures.
Antoniou identified labour shortages as a major challenge, stating that the current workforce in Cyprus is insufficient to meet rising demand. He advocated for the simplification and automation of procedures to secure additional workers. Furthermore, Antoniou noted the impact of heightened raw material, transport, and energy costs on the sector, attributing these to the COVID-19 pandemic, geopolitical tensions such as Russia's invasion of Ukraine, and developments in the Middle East.
Despite these challenges, Antoniou observed that demand remains robust, driven by population growth and investments requiring a physical presence in Cyprus. He also mentioned that financial institutions are maintaining cautious lending practices, reducing the risk of a property market 'bubble'.
CCCI Secretary General Philokypros Roussounides remarked that the increase in building permits reflects the resilience of the Cypriot economy and the continued recovery and growth of the construction industry. He suggested that while the figures signify genuine economic activity, detailed examination is needed to assess the impact of specific investments on different periods.
Roussounides highlighted bureaucracy and digitalisation as significant challenges, particularly in the licensing process, suggesting that a more efficient and attractive system could bolster Cyprus' appeal to investors. He also discussed the challenges of housing affordability, noting that purchasing a home is more difficult compared to previous decades due to rising energy costs, raw material prices, and geopolitical influences on final prices.