New reports indicate that prices in the Cypriot property market remain stable into the second half of the year, as demand for properties continues high from foreign investors.
New research from Assetz, a property investment company, shows an increase in prices of 2.5 per cent since the beginning of the year, fuelled by a jump in demand from overseas buyers.
Cyprus has emerged as something of a holiday home hotspot for UK buyers, offering relatively cheap properties in attractive holiday locations, says Assetz.
In a recent ranking of the top 20 most desirable second home and property investment destinations Cyprus ranked ninth overall, ahead of a number of traditional favourites in Spain and France.
According to the BuySell Home Price Index, which assesses the movement of prices at which residential properties are sold in Cyprus based on monthly sales, the average house price in Cyprus currently stands at CYP 85,317 (€143,789, £98,922).
Cyprus has risen significantly in popularity in recent years. House prices have trebled since 2000 and rose by 18 per cent last year alone, strong indication of rising demand, particular for buy-to-let ventures.
Perhaps most importantly, prices in Cyprus remain notably lower than in France and Spain, offering buyers more for their money.
"Prices are still considerably lower than in France or Spain - a three-bedroom detached villa with a private pool would currently set you back around €363,386 (£250,000) in a quality location, which would probably only stretch to a large two-bedroom apartment in the South of France," says Stuart Law, managing director of Assetz.
The firm says in 2007 property prices in Cyprus are expected to rise even further once Cyprus joins the Euro, and value increases of as much as 50 per cent have been predicted.
Assetz highlight Paphos as a particularly attractive location for holiday home bargains, with other up and coming areas including Polis and Larnaca, at the slightly cheaper end of the market.
But Assetz cautions consumers of the risks of investing in the north of Cyprus.
"Since restrictions on movement and trade in the north were lifted when Cyprus joined the EU last year, many Greek Cypriots have returned to land they lost and are claiming restitution or negotiation," says Mr Law.
"For this reason I would not advocate buying in the North until these issues have been resolved."
For more information about investing in Northern Cyprus visit the European Property Association of Northern Cyprus website - www.eupro.co.uk
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