Among Cyprus's real estate markets, Paphos stands apart. No other district in the country attracts a higher proportion of overseas buyers in the third quarter of 2025, international purchasers accounted for more than two thirds of all property transactions recorded there. That figure speaks to something structural: Paphos has built a reputation as the island's most internationally accessible market, combining coastal lifestyle appeal, a well-established expat community, and properties that regularly qualify for the fast-track permanent residency programme.
Price growth has reflected this demand. During mid-2025, residential values in Paphos rose by between roughly 12% and 14%, among the strongest figures recorded anywhere in Cyprus. Yet the market retains a quality that sets it apart from overheated urban property scenes elsewhere in Europe: growth has been steady and lifestyle-driven rather than speculative, supported by consistent tourism income, year round rental demand, and ongoing infrastructure investment including the expansion of Paphos International Airport.
The investment environment has also been significantly improved by a package of tax reforms that came into force on 1st of January 2026. Stamp duty, previously an unavoidable cost in any property transaction, has been abolished entirely. The special levy on rental income has been removed. And the lifetime capital gains tax exemption on a primary residence has been increased substantially, to €150,000. Together, these changes represent a deliberate effort by the Cypriot government to make the country more attractive to international buyers and in Paphos, where that buyer base was already the strongest on the island, the effect is likely to be particularly pronounced.
For anyone considering a property acquisition in Cyprus that also opens the door to permanent residency, Paphos in 2026 offers a compelling combination of legal eligibility, financial incentive, and long-term value.