Rental yield and returns in Limassol and Cyprus

The short answer

In the second quarter of 2026, apartments in Cyprus yielded 5.51% gross, up from 5.41% a year earlier, according to the RICS Cyprus Property Index with KPMG. Over the same year apartment values rose 5.42% and apartment rents 7.36%. Yield plus price growth came to about 11% before costs and tax for that year. That is a past result, not a forecast.

Yields by property type

Apartments earn close to twice what houses do relative to their price. Houses cost more per bedroom and their rents do not keep up. Apartments were also the strongest asset for price growth (+5.42% a year), ahead of warehouses (+4.22%), houses (+4.04%) and offices (+3.69%).

Limassol

Limassol has the island's deepest rental market, driven by international companies, shipping and the schools. Global Property Guide's Q1 2026 survey of asking prices and rents puts Limassol apartments at about 5.3% gross on average, with smaller homes earning more: about 5.9% for one bedroom, 5.8% for two and 4.3% for three.

The pattern holds across the city: the more a home costs per square metre, the lower its yield tends to be, because prices in prime areas rise faster than rents. Buyers there are usually weighing capital growth and their own use alongside the rent.

Gross vs net: what you actually keep

Published yields are gross: a year's rent divided by the price. Your net return is lower once you count:

• Purchase costs: VAT on a new home or transfer fees on a resale, plus legal fees. See the cost of buying property.
• Running costs: the building's common expenses, local authority fees, insurance and repairs.
• Management, if an agent finds tenants and looks after the home.
• Empty months between tenants.
• Income tax on the rent (below).

How rental income is taxed (2026)

Cyprus reformed personal tax from 1 January 2026. For an individual taxed in Cyprus:

• The special defence contribution on rent (effectively 2.25%) was abolished from 1 January 2026.
• 20% of the rent is deducted, and the rest is added to your income and taxed at the personal rates: nothing on the first €22,000, then 20%, 25%, 30% and 35% above €72,000.
• The 2.65% General Health System contribution applies to the rent.
• A company owning the property pays 15% corporate tax on its rental profit.

If you are tax resident elsewhere, the rent is usually also reportable in your home country, with credit for Cypriot tax under a double tax treaty. Take advice for your own case.