We seem to follow the Irish example on the ways to correct our economy and many of the steps undertaken in Cyprus are a copy of Ireland’s measures.
The more recent one is the incentives that the Cyprus Government has introduced in order to provide Affordable Housing, both for rental, as well as for acquisition purposes. The lack of development over the recent years (post 2013) suitable mainly for the middle income groups/locals, as well as the increased demand emanating from the students housing demand, Airbnb and restricted financing to home buyers etc, has increased demand for rentals, which, according to the Ministry of Labour statistics, caused rents to increase by 30%-40% in Limassol and Nicosia over the last couple of years. So the Government came up with the idea of providing incentives to make the development of affordable apartments/housing and units to let attractive (in order to increase supply and satisfy demand).
We have examined the incentives and we have published in detail in the local Greek press why we think that the measures are not enough and imaginative (whereas on some occasions are contradictory) in order to help the situation.
Basically the incentives on the one hand provide increased building density, so that more units can be provided on a certain plot, but then it places numerous restrictions and limitations, so at the end it is a “gift without substance” (as we say in Greek).
The main cause of the housing shortage started 15 years ago, when some theoreticians from the Planning Department decided to fix the minimum size of apartments/houses, depending on the number of bedrooms. So we ended up for a 2 bedroom unit to have a minimum size of 100 sq.m., a 3 bedroom one of 120 sq.m. and so on. Instead of letting the market demand express the wish what people want/can afford, we ended up with units around 20%-30% larger in size than what people can afford – hence one of the reasons of the problem.
Quoting again the ex-minister of Environment of Ireland, who declared that “we should build houses that people can afford” (affordable housing) and following their experience, we have (as Government) now waken up to the facts of life and reality. We objected to the fixing of housing sizes 15 years ago and every year 2-3 times we remind the Government at the time how wrong this was. Now we are faced with non-affordable housing and even with the incentives given, the Government came too late to cover Cyprus needs (especially for the younger generation and the lower income groups). Such hopefully incentives/new projects will not come into the market earlier than 2-4 years and in the meantime the shortage of affordable housing will become worse (a similar situation exists with the non-workable common fund law for which we object regularly in the press as well as through direct contact with the Interior Ministers at the time - 10 years ago and keep going in hope of correction).
We are annoyed and angry about the stupidity of our own “experts” on the subject and we have even proposed to have those in charge and with deaf ears to bear some sort of a personal financial responsibility and or letting them go from the Civil Service.
The creation of incentives for affordable housing should be compared in a cost/benefit analysis in order to ascertain if the incentives will work and reach the desired goal, or they stand to fail (as we expect).
In this article we do not provide the full analysis as we did through the Greek press and we have also addressed to the Ministry of Interior, as well as to the political parties (we did the last with respect because this is not necessary a political issue, but more of a common sense one).
We live in hope dear readers, but even our own hope is fading away (be it that we will not stop nagging and criticize the attitudes, including the independent technical groups, such as the Architects Association, planners and others who have a role in this – but keep indifferent-quiet. To our criticism we include the journalists who do not appreciate, it seems, their power and affect they have through their publications on corrective measures needed. It took one month of reporting in the local media for the Government and political parties to wake themselves up and to face a problem that is in existence for over 7-8 years.
In our original article on the matter (since 2018) we have asked if the Irish Government could lend us its Minister, who come up with this idea of affordable housing to teach our thick headed planners and others how the job is done.