**NICOSIA, CYPRUS** – A recent cost of living assessment for 2025 has cast a stark spotlight on escalating expenses across Cyprus, with the coastal city of Limassol emerging as a significant outlier. The findings underscore a growing concern that the island nation's economic trajectory, particularly its reliance on attracting foreign investment and a burgeoning tourism sector, is placing an unsustainable strain on its resources and its local population.
The comprehensive survey, which analysed a range of expenditure benchmarks, revealed considerable disparities in prices between Cypriot municipalities. Limassol, a magnet for international businesses and their expatriate workforces, has solidified its position as the most expensive locale on the island. This economic dynamism, while contributing to the national GDP, has concurrently driven up rental markets and consumer prices to a point where many earning local salaries are finding it increasingly difficult to maintain a foothold in the city. The consequences are tangible, with a notable exodus of Limassol residents seeking more affordable accommodation in neighbouring villages.
The ramifications of this rapid expansion are not confined to housing costs. The increased population density, bolstered by a consistent influx of tourists, is placing considerable pressure on the island's finite resources. The Electricity Authority of Cyprus (EAC), for instance, has reported that it can "just about" meet the nation's electricity demands during the peak summer months, highlighting a precarious balance between supply and escalating consumption. Similarly, water scarcity, a long-standing challenge for the Mediterranean island, is being exacerbated by these growing numbers.
At the heart of this economic quandary lies the government's strategy of actively encouraging a continuous stream of foreign enterprises and their employees, alongside an ambitious pursuit of record-breaking visitor arrivals. While these policies have undoubtedly fostered economic growth, critics argue that the unbridled pursuit of expansion has outpaced the island's capacity for sustainable development and rational resource management. The data paints a clear picture: a one-bedroom apartment in Limassol's city centre commands an average rent of €1,338 per month, more than double that of Nicosia, which stands as the cheapest urban centre for housing at €664. Property prices per square metre in Limassol also significantly outstrip those in other cities, averaging around €4,500.
This disparity in housing costs is further amplified when juxtaposed with average wages. Limassol's average monthly salary of €2,500, while higher than other cities, represents a significant proportion – 32.2% – of household income dedicated solely to rent. In contrast, Nicosia offers the lowest average salary at €1,550, though its housing market remains considerably more accessible. This widening gap between income and expenditure is fuelling anxieties about social equity and the long-term viability of Cyprus's current economic model.
As the island navigates these complex challenges, a consensus is slowly forming that a recalibration of its growth strategy is not merely desirable, but imperative. The current approach, characterised by an insatiable appetite for increased visitor numbers and foreign investment, is increasingly being recognised as a path fraught with environmental and social risks. Moving forward, the focus must shift towards fostering a more balanced and resilient economy, one that prioritises not just growth, but sustainable prosperity for all its inhabitants. The question now is whether Cyprus can effectively implement policies that curb the excesses of its success and cultivate a future where economic advancement and environmental stewardship go hand in hand.