Why North Cyprus

Cyprus is welcoming an ever-increasing number of tourist and those looking to relocate for parts of the year or permanently. Located at the crossroads of three continents, namely Europe, Asia and Africa, the island reflects this fascinating blend of rich history, cultures and influences. For thousands of years, Cyprus has been an important hub for commerce, bringing people from various regions, cultural and social backgrounds together to trade.

But what makes Cyprus so appealing today? And why are more and more people moving to North Cyprus in particular?

With over 330 days of sunshine per year and a pleasant Mediterranean climate, Cyprus is an ideal destination to stay in all year round. During the mild winters, the island turns green and fruit orchards are in full harvest, making this the perfect escape from the cold, unpleasant northern winters. A great variety of fruits and vegetables, nature trails and ever-expanding public and private sports facilities throughout North Cyprus offer a great foundation for a healthy lifestyle and more work-life balance. 

At the same time, the cost of living is only a fraction of that in Western European countries while economic malaise, political upheaval and a fast social decline are plaguing the latter, drawing an increasing number of well-to-do individuals and families to seek out alternative places to reside. In comparison, North Cyprus is a haven of political stability, crime is almost non-existent and yet, one can be back in the European Union within an hour’s drive from most locations. 

Who is moving?

This easy access, the healthy and relaxed lifestyle as well as the comparably low cost of living are not only an appeal for tourists from Europe and within the region but also encourage more and more people to relocate to North Cyprus for parts of the year or permanently. 

Especially, those located in countries with harsh, long and cold winters are drawn to North Cyprus during the winter season while still maintaining a home to return to for the summer. But a rapidly increasing number of Europeans are relocating for their wealth protection, the attractive tax benefits and the appeal as a retirement destination. 

We are therefore seeing an influx of property buyers from various countries that have decided that the timing is just right to invest in this fast-growing market. While many are looking to buy a home primarily for self-use, the investment appeal cannot be understated. 

Long-term vs. short-term rentals

One the one hand, lifestyle investors are buying North Cyprus properties because they wish to use their home for vacations or longer stays and do not want to stay in hotels during such periods. However, when these owners are not using their holiday residence, costs are still incurred for maintaining their property. Therefore, they choose to rent out their North Cyprus property during their absence to cover the operating costs while being able to generate attractive returns on their investments. 

Most resort projects offer some form of rental services and there are also companies that allow hands-off management for property owners. All you need to do is hand over the keys and wait for bookings and money to come in. Regular statements are provided to show you the key performance indicators of your rentals such as booked nights, average daily rate (ADR) and the operating expenses including marketing, cleaning and management fees as well as your net income after these deductions.

On the other hand, many investors are buying properties without the consideration of self-use. These investment properties can then also be rented out on a long-term basis, for example to expats or retirees moving to North Cyprus that have not bought their own property. The appeal of long-term rentals is that the income is stable each month in contrast to the seasonality of holiday rentals. All operating expenses are borne by the tenant and rents are typically paid in British Pounds. 

Especially, cities such as Kyrenia and Famagusta have a large number of international students who study at various private universities. They are well-funded and reliable tenants that compete for quality accommodation in an as of yet undersupplied market. This keeps the rental yields for buy-to-let investors high for the foreseeable future. 

Typically, however, with solid and professional rental management services, the returns for holiday rentals are much higher than for long-term rentals. Particularly, since resort destinations on the Northern coast of Cyprus between Kyrenia, Esentepe and Tatlisu still lack hotel infrastructure apart from the ubiquitous casino resorts. 

Iskele as an example

A good marker for the potential of holiday rentals is Iskele, a relatively new tourism market that has been developing over the last ten years. Today, a variety of mid-market, high-end and luxury complexes offer holiday rentals services. The best of those are running highly successful operations for unit owners with an annual average occupancy rate of 60-75% and attractive ADRs from GBP45 to GBP150 per night depending on the size of the unit from studio to two-bedroom flats as well as the market segment they are operating in. This can generate annual rental yields of 6-12% based on the purchase price after all operating expenses are deducted. A worthwhile investment when one considers that North Cyprus property owners can also use their holiday home whenever they want to. 

Northern coast from Kyrenia to Tatlisu

The northern coast between Kyrenia and Tatlisu is the next promising resort destination in North Cyprus. Esentepe and Tatlisu offer a dramatic coastline with commanding views all the way to the Turkish mainland, a plethora of beautiful private bays and seaside resort projects that typically feature excellent common amenities including swimming pools, spa and hammam, sports facilities and kid’s playgrounds, restaurants and many more. 

Here, too, the rental potential is excellent given the scenic beauty that combines the mountain range to the south, the greenery of the surrounding forests and the azure to turquoise-blue sea as well as the lack of hotels to cater to the increasing number of tourists and long-stay guests that wish to be in the area. Daily rental rates for 1-bedroom units range from 60-80 GBP, for 2-bedroom units from 120-180 GBP and from 200-500 GBP for a 3-bedroom residence around Esentepe in resort projects that feature five-star facilities. 

In Tatlisu, the prices are still a bit lower due to the lack of tourism infrastructure but that offers tremendous upwards potential for the future as the area is fast developing into the next resort destination after Esentepe. With increasing numbers of direct flights into North Cyprus, Tatlisu is well-positioned to take advantage of the influx of more tourists as it is only 40 minutes away from Ercan International Airport. 
The appeal of staying in a resort apartment or villa during one’s vacation is crystal clear. These properties offer a more personal atmosphere and guests can feel at home while not missing any of the service or amenities that traditional hotels provide. Likewise, as an investor one can have the best of both worlds, either using one’s resort property during holidays or renting it out and generating income from other guests.

Still, the devil is in the detail and not every resort project will keep its promise of excellent returns and great facilities to unlock the investment potential that North Cyprus certainly offers. It is therefore recommended that you consult with an expert on property investment. Mediterra Group is your ultimate partner in North Cyprus with its diverse portfolio of apartments and villas. Call us at +90 533 832 02 22 or mail us at [email protected]  and let us guide you through Cyprus, its real estate market, and all the details you should know.