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Sancho Panza

Acute Property Slump Takes Hold In Bailed-Out Cyprus:

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Reuters 23/7/13

'(Reuters) - Cypriot property prices recorded one of their steepest falls in years in the second quarter, a survey showed on Tuesday, as an austerity-driven recession sapped demand in the country's once-buoyant property market.

Cyprus struck a deal with international lenders for 10 billion euros in aid last March, but in return had to wind down an insolvent bank and impose losses on big deposits in a second. Capital controls to prevent a bank run are in place.

"Definitely the market is going to deteriorate further and faster than before. There is no lending available and people's money (in banks) is blocked," said Pavlos Loizou of RICS Cyprus, a compiler of the survey.

Second quarter annual declines - which ranged from a 12.6 percent price drop in the valuation of an apartment to a 23.3 percent fall for office space - were the sharpest recorded since RICS started collecting data in 2009, Loizou told Reuters.

Conceivably, they could be the sharpest over many years in a market not accustomed to sudden drops in valuations.

For at least a decade before 2009 Cypriot property prices were steadily growing on the back of foreign demand and liquidity-flush banks extending credit.

Over two growth cycles immediately before and after Cyprus joined the EU in 2004, property prices rose anywhere between 150 and 200 percent, Loizou said.

Boarded up shops have become commonplace in central Nicosia, the island's capital.

On Makarios Avenue, which was once a commercial hub teeming with traffic, dozens of shops stand empty, driven out by high rents and a shift in consumer preferences to other locations, including out-of-town malls.'

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A great buying opportunity.

Not really, they are still vastly overpriced, Cyprus was overpriced 10 years ago already.

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  • 242 Brexit, House prices and Summer 2020

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      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%

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