The budget airline Monarch is about to launch low-cost flights from Britain to Cyprus. The new flights, from Luton to Larnaca, begin on Monday and cost from just £69.99 one way, including taxes, with some introductory seats at £39.99. Ryanair is also planning to move into Cyprus soon, and, along with the huge expansion of Paphos and Larnaca airports, will result in a great increase in visitor numbers.
Cyprus is undergoing rapid changes. New flights aside, there are many factors stacking up that promise to transform Cyprus in the next few years and investors are rubbing their hands together in glee. It is the multi-million pound marinas set to emerge at Larnaca, Paphos and Limassol, the new golf courses and much more.
Optimism has been on the increase since Cyprus joined the European Union in 2004 and the border between Greek and Turkish Cyprus was relaxed. Entry into the eurozone in January 2008 will be the icing on the cake for the Greek Cypriots: replacing the Cyprus pound with the euro will bring added stability and confidence.
The adoption of the euro is an exciting progression. The positive effects upon the economy are likely to increase demand in an already buoyant market and lead to an increase in house prices. Cyprus's charms are already well-known to UK buyers, especially as it was once a British colony. It has a good infrastructure and a friendly, widely English-speaking population. There is no inheritance, gift or wealth tax, and personal taxation is low, starting from just 5 per cent.
The climate offers almost year-round sunshine, the main towns and cities give a sophisticated choice of shops, restaurants, art galleries and theatres, while the villages offer an escape to the relaxed lifestyle of old. There is virtually no crime on the island and the cost of living is still very low.
There are currently 60,000 British homeowners on the island providing a lively expat community. Property prices have shown a steady increase over the past 10 years, averaging about 8 per cent per annum. While emerging markets such as Bulgaria and Romania are cheaper, property prices on the island are still very competitive compared to Spain, Portugal and Italy.
Cyprus has strict building regulations aimed to prevent overdevelopment, as opposed to countries like Spain. A prime example is that no residential building can be higher than three storeys. Many countries, such as Bulgaria, do not have such building controls.
Jacob Klein from Israel, has several properties in Cyprus and he is pleased with his investments. Every town and city is built up but you can find sleepy villages quite easily. I bought several off-plan apartments in Larnaca last year for £45-60,000 each and the developer is planning similar ones for £65-90,000 this year."
But the new flights do not impress everyone - particularly, for obvious reasons, those involved in selling Spain. "Cyprus may be getting a new budget flight, but there are already low-cost flights to Spain from almost every corner of the UK and the flight times are also only 2.5 hours on average, as opposed to 4.5 hours to Cyprus," says Chris Mercer of Spanish specialist agency Mercers.
Kieran Byrne, managing director of Home España, says: "With the wide range of airports, frequency of flights and short journey times, it is no wonder that people choose Spain as their No 1 holiday destination. Cyprus offers a good long-term investment but there is not an established resale market, like there is in Spain. In the short term, investors will struggle to sell new builds on and there may not be much call for rentals."
While Cyprus is clearly set for transformation in the coming years, no one yet truly knows how much of that will be for the better, and how much for the worse.
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