To alleviate the housing problem, the supply of housing units needs to be increased, Interior Minister Konstantinos Ioannou said today, speaking to media representatives on the sidelines of his participation in the session of the Parliamentary Committee on Refugees.
Mr. Ioannou referred to the implementation of the Urban Planning Incentives Plan, noting that the goal is to increase the housing supply in order to significantly address the housing shortage. He added that the rise in prices is due to various factors, such as the inflation that has prevailed in recent years, which has resulted in increased construction costs being passed on to the buyer or tenant.
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“At the same time, however, our intention is to increase supply so that there is a balance between supply and demand, prices will ease, or at least keep them at current levels and prevent them from rising,” the Minister said. He pointed out that, to this end, “our flagship initiative is the Urban Planning Incentives Plan. Let me remind you that we are offering a floor area ratio of up to 45%, on the condition that a portion of that ratio be allocated to affordable housing. In this way, we are increasing the overall housing stock and the supply of affordable housing.”
According to the data, 47 applications have been submitted so far and approved through the fast-track permitting process. “This translates to more than 2,500 housing units, 400 of which will be affordable housing. Additionally, €17 million has been generated from the right to purchase building density quotas, which is being deposited into the KOAG Special Affordable Housing Fund,” said the Minister of the Interior. With the funding KOAG receives through the Urban Planning Incentives Plan, the construction of 244 units for affordable sale and 192 units for affordable rent will be promoted in 2026.
As the Minister of the Interior explained, the issue of housing is a priority for the European Union, which also focuses on affordable housing. At the same time, he noted that the European Commission attaches great importance to expedited permitting to accelerate the entry of housing units into the housing market. “This issue is still being discussed in the EU. We have been implementing it in Cyprus for a year now. The numbers change every week because there is now enormous interest. According to May’s data, 930 apartment buildings and approximately 3,000 residential units have been approved,” said Mr. Ioannou, noting that this translates to approximately 9,000 apartments, construction of which can begin immediately.
The Minister noted that another factor contributing to the resolution of the housing crisis is the fact that the private construction sector is operating at full capacity.
In response to a journalist’s comment, the Minister of the Interior emphasized that the Ministry’s announcements regarding the housing issue are the result of a thorough technical and economic study, and their practical feasibility is always examined. “We let our actions speak louder than our words. Everything we announce is based on an evaluation,” he emphasized.
When asked why taller apartment buildings aren’t being constructed to create more apartments, the Minister explained that permits can be granted for one or two additional floors. Regarding single-family homes, he said that most are located in areas where the construction of a second floor is permitted; however, other factors are deterring citizens. “Some political parties say this option should be granted, but it already exists. So, before we speak, we must examine what the solutions are and evaluate them,” he noted.
Finally, referring to the Local Plans, he said that the process of revising them has begun, with the goal of announcing them around the end of 2027. It is expected that this will provide a boost to development, not only in terms of housing but also in business, industry, livestock farming, agriculture, and so on. ““The easiest thing is for someone to say that I’m allowing two additional stories in all areas. That’s not the case. Decisions are being made that will be evaluated because they have implications,” Mr. Ioannou concluded.
*Press Release
