For many years, Cyprus was largely a cash-buyers’ market. Mortgages existed, but were rarely a decisive factor in property transactions. This has changed.
Despite higher interest rates compared to the pre-2022 period, mortgages have once again become a working tool — for both residents and foreign buyers.
That said, mortgage financing in Cyprus is not universal, not fast, and not equal for everyone. Banks remain conservative, highly regulated, and very selective.
This article explains how mortgages in Cyprus actually work in 2025–2026, with real figures, requirements, and limitations.
Who can get a mortgage in Cyprus
Cypriot banks clearly separate borrowers into three categories, and the difference in conditions between them is fundamental.
Cypriot citizens and EU residents have the easiest access to mortgage financing. For them, a mortgage is a standard retail banking product with relatively high loan-to-value ratios and the lowest available interest rates.
Third-country nationals (including CIS countries) can also obtain a mortgage, but under stricter conditions:
- lower maximum financing percentage,
- higher equity requirements,
- stronger scrutiny of income sources and financial history.
In practice, a residence permit in Cyprus is not legally mandatory, but without it most banks will simply refuse the application.
Mortgage terms in 2025–2026: real market figures
As of late 2025, the typical mortgage conditions offered by major Cypriot banks are as follows:
Interest rates
- Variable rate: approximately 4.2–5.0% per annum
Usually calculated as Euribor (most often 6M) plus a bank margin of 2.0–2.8%. - Fixed rate (3–10 years): typically 4.5–5.6%
Fully fixed loans for 20–25 years exist, but are rare and significantly more expensive.
Loan term
- Standard term: 15–25 years
- Maximum borrower age at loan maturity: 65–70 years, depending on the bank
Down payment (equity contribution)
- Cypriot citizens / EU residents: 20–30%
- Non-EU buyers: 30–50%, most commonly closer to 40–50%
Banks that actually issue mortgages
In practice, the mortgage market is concentrated in a limited number of institutions:
- Bank of Cyprus — broad product range, strict compliance
- Hellenic Bank — competitive rates, slower approval process
- Eurobank Cyprus — more open to foreign borrowers, conservative risk policy
- Alpha Bank Cyprus — selective lending, often broker-mediated
Smaller banks and cooperatives exist, but are rarely relevant for foreign buyers.
New developments, resale property and commercial real estate
New developments
- Banks generally prefer properties with a valid building permit and a clear path to title deed issuance
- Financing is usually based on bank valuation, not contract price
- VAT applies (5% for primary residence under conditions, otherwise 19%)
- Risk lies mainly in construction timelines and title deed delivery
Resale property
- Legally simpler
- Title deed is mandatory
- Often stricter valuation and liquidity assessment
Commercial property
- Mortgages are possible, but:
- interest rates are typically 0.5–1% higher
- loan terms are shorter (10–15 years)
- business plan or lease agreements are usually required
Mortgage cost examples
Residential property €300,000
Non-EU buyer with residence permit, 40% down payment.
- Loan amount: €180,000
- Interest rate: 4.7%
- Term: 20 years
- Monthly payment: approximately €1,150–1,200
Premium property €500,000
50% equity, partially fixed rate.
- Loan amount: €250,000
- Interest rate: 5.2%
- Term: 20 years
- Monthly payment: approximately €1,650–1,700
Banks always apply a stress test, ensuring the borrower can still service the loan if interest rates rise by 1.5–2%.
Income and documentation requirements
A standard mortgage application includes:
- confirmed income history for 2–3 years
- tax declarations
- bank statements
- credit history (if available)
- property sale agreement
- independent valuation report
A common internal rule:
monthly mortgage payments should not exceed 30–35% of net household income.
Additional and hidden costs
A mortgage is not only about the interest rate.
Additional costs include:
- bank fees: €1,000–3,000
- property valuation: €400–700
- mandatory property insurance
- life insurance for the borrower (often compulsory)
- legal fees (strongly recommended in Cyprus)
Permission to purchase property
Non-EU nationals must obtain permission from the Council of Ministers to acquire property in Cyprus.
This is largely a formal procedure, but without it the bank will not release mortgage funds.
Typical processing time: 1–3 months.
Final assessment: does a mortgage in Cyprus make sense?
A mortgage in Cyprus is a tool for long-term, structured buyers, not for short-term speculation.
It makes sense if:
- income is legal, transparent, and preferably euro-denominated
- the purchase is long-term (residency, rental income, capital preservation)
- the buyer is prepared for compliance checks and bureaucracy
It is not suitable for those expecting quick approvals or high leverage.
Cypriot banks are conservative — but predictable.
In today’s European environment, that predictability is often a strength rather than a weakness.
