Why do apartments in Cyprus on higher floors cost up to 20% more?

Apartments in Cyprus In the same building, prices can vary by several thousand, or even tens of thousands of euros, despite identical square footage, layout, and standard of finish. One reason is the floor on which the apartment is located.

There is a concept in the development market floor premium, which is a premium for being located on a higher floor. Depending on the development, the price can increase by approximately 0.5–2% with each subsequent floor. In projects offering sea views, the difference between a lower and higher floor unit can be as much as 15–20%.

Apartments in Cyprus. Where does the premium for a higher floor come from?

At first glance, the price difference may seem difficult to justify. The two apartments have the same square footage, identical layouts, a similar terrace, and the same standard of finishing.

However, the buyer doesn't pay only for square meters. In the case of higher floors, the view, amount of light, privacy, less noise and the potential value of the property upon subsequent sale.

As a result, an apartment located several floors higher may be treated by the market as a higher-class product, even if technically it is practically no different from the apartment located below.

A sea view has its price

In Cyprus, one of the most important reasons for paying extra for a higher floor is sea view.

The higher the apartment is located, the greater the chance of a wide panorama and the lower the risk that the view will be obscured by neighboring buildings in the future.

This is particularly important in the rapidly developing areas of Limassol, Paphos and Larnaca, where new investments may in the future change the surroundings of existing buildings.

For buyers, a view is an element that can't be added later or improved through renovation. This is why apartments offering the best views are often among the most expensive units in the entire project.

More light and more privacy

Higher floors are usually better lit and less likely to be obscured by neighbouring buildings, trees or infrastructure.

Privacy is also important to many buyers.

A first-floor apartment may be located directly above the street, parking lot, swimming pool, or other common area of the development. This issue is usually less acute several stories higher.

Higher floors can also reduce some noise from the street and common areas. All of these elements influence how prospective buyers perceive the value of the apartment.

The best apartments are often the first to sell

Price differences also result from the behavior of buyers themselves.

When a developer starts selling a new project, apartments with the best views, favorable exposure and located on the most attractive floors often generate the most interest.

As the number of such premises decreases, their availability becomes an additional pricing argument.

Therefore, a seemingly identical apartment on the fifth floor may be priced much higher than an apartment on the first or second floor.

Is an apartment on a higher floor a better investment?

Not always. It all depends on the purpose of the purchase.

If apartment in Cyprus is purchased as a long-term investment, the floor, view and exposure may be of great importance when later reselling.

Buyers looking for premium properties are often willing to pay more for features that cannot be easily changed – primarily location in the building and an unobstructed view.

The calculation may be different for an apartment intended primarily for short-term rentals. In such cases, the distance to the beach, the pool, the standard of the entire complex, the size of the terrace, the apartment layout, and the potential price of the accommodation are also very important.

Therefore, paying extra for the top floor does not always translate into proportionally higher rental income.

The exposure of the apartment also matters

The floor itself should not be analyzed in isolation from other parameters.

Before purchasing, it is worth checking, among other things:

• which direction the terrace is facing,
• whether the view may be obscured in the future,
• what the surroundings of the plot look like,
• where the elevators and common areas are located,
• how much sunlight the apartment gets,
• whether further development is planned nearby.

An apartment located higher up but facing a less attractive direction is not necessarily a better choice than a well-located apartment a few floors below.

Price per meter is not everything

Comparing apartments in Cyprus, it's easy to focus primarily on the price per square meter. However, in new projects, such an analysis can lead to erroneous conclusions.

Two apartments with identical space may have a completely different market value due to their floor, view and location in the building.

Therefore, paying a few or a dozen percent extra doesn't always mean that a more expensive apartment is overvalued. In some investments, it may retain greater attractiveness upon subsequent sale.

When choosing a property, it is worth looking not only at the square footage and price, but also at the features that cannot be changed after the purchase. The floor and the view are just such elements.

Sources: real estate market analysis – Kasia Gadomska.