Assetz® News - Promising trends in Cyprus

Promising trends in Cyprus

23rd December 2008 |

With so many economic statistics showing up bad news, be it shrinking economies, rising unemployment or falling property prices, investors may be wondering where they can look for some good news to encourage them to spend their money.

Cyprus may have been seen by some as not providing the answer in recent times. One reason for investing overseas is tourism, with all the potential for buy-to-let renting that this offers. But for months the statistics for the sector in the country have been in decline, even though - as British TV viewers may have seen - there have been efforts to advertise the island's charms overseas.

Nor has the economy necessarily provided a compelling argument for investing, even if it is far removed from the recession-hit gloom that has fallen like a shroud across much of Europe and the United States. While not heading for a contraction of its own, 2009 will see notably slower growth in the country, Cypriot central bank governor Athanasios Orphanides has warned, with tourism being one obvious potential area of concern.

Yet it may be that the relatively stronger economy of Cyprus could help sustain its attractiveness for property investment. To do so, however, may require good news in sectors specific to the property market.

Such statistics, however, may have just arisen. The Passenger Survey, which records the latest trends and statistics, found that in November the revenue from tourism rose in year-on-year terms for the first time in five months, up to €72.4 million (£68.7 million) from the €67.8 million total of 12 months earlier, Travel Daily News reported.

In addition to this, tourism figures were also up for the first time in five months - to 97,900 - compared with the November 2007 figure of 94,741. What was notable was that while the UK - which supplies half the tourist base of the country - was down by three per cent and German tourism also in decline, non-European Union visitors were up, with Russian numbers over 24 per cent higher.

Another promising trend has been the rise in building permits. Official government figures revealed that the number of these issued in October rose, with the value, area and number of new dwellings being constructed all on the rise from a year earlier. In the latter case, 2,088 new homes will be built as a result of the permits, compared with an October 2007 total of 1,774, reports the Financial Mirror.

The paper noted that the year-on-year trend prior to October was downwards by 8.4 per cent, all of which may suggest that Cyprus is bouncing back. It could be that, just as there has been an apparent shift in incoming tourism patterns that have seen new sources replace old ones, the property sector itself is seeing a bounce from the status of the country as a relatively stable economy, even if it is no longer booming. In the current climate, that could make Cyprus an attractive place to be.