Cyprus property investment: is it really as safe as houses?

It is a market we all think we know something about. But often our knowledge is based on nothing more than having bought a house for our own use or having rented a commercial property.
In Cyprus, as in most EU countries, the value of property has grown steadily, if gradually, over the years and rental incomes have increased accordingly. That makes property a sound investment but not necessarily a great one in terms of yield.
Moreover, a look at the graph will show that the steady rise of property values is interrupted every few years by sharp declines. In time, the market always recovers but a short-term investor with limited funds can be badly caught out.
It is a difficult market to interpret. Just how difficult was brought home to me by two views of Cyprus property I read recently.
The market here has been growing impressively. According to the RICS Cyprus Property Price Index, issued in June last year, the average price of apartments increased by 7.6 per cent, houses by 4.8 per cent, offices by 11.6 per cent, warehouses by 4.2 per cent and retail premises by 1.7 per cent. With the exception of retail, all were ahead of GDP which grew by around 4 per cent last year.
This made investment in real estate in Cyprus “worthwhile for foreign and local investors for all types of property”, according to George Coucounis, a lawyer specialising in property law.
He told readers of the Cyprus Mail that last year “was one of the best in recent years regarding property sales and investments, focusing on the tourist industry, selected investments for the acquisition of a Cyprus passport, the sale of used houses and apartments in urban and nearby areas”.
Source: Financial  Mirror