Top 5 Locations in Cyprus for Holiday Let Investments
With year-round sunshine, blue-flag beaches, and a welcoming Mediterranean lifestyle, Cyprus is one of the most sought-after destinations for holidaymakers—and increasingly, for property investors looking to capitalise on the booming short-term rental market.
Holiday let investments in Cyprus offer strong seasonal returns, growing demand through digital platforms like Airbnb and Booking.com, and the added appeal of personal use during the off-peak months. But where exactly should you invest?
In this comprehensive guide, we explore the Top 5 locations in Cyprus for holiday let investments in 2025, comparing each for rental yields, tourist demand, infrastructure, and investment potential.
Why Holiday Let Investments Make Sense in Cyprus
Before diving into the top locations, let’s look at why Cyprus is a smart choice for short-term property investment:
- Over 4.5 million tourists expected in 2025
- Extended holiday season (April to October, sometimes longer)
- Competitive property prices compared to other Mediterranean markets
- High daily rental rates during peak months
- Airbnb-friendly legislation (with licensing)
Holiday rentals offer significantly higher gross yields compared to long-term lets, particularly in well-located, well-furnished properties.
Now, let’s examine where investors are seeing the best returns and why.
1. Protaras – The Family Favourite with Stellar Summer Demand
Overview
Protaras, located on the south-eastern coast near Paralimni, is a picturesque resort town famous for Fig Tree Bay, crystal-clear waters, and family-friendly beaches. It’s a seasonal powerhouse, drawing thousands of tourists each summer—particularly from the UK, Israel, and Eastern Europe.
Key Features
- Blue Flag beaches with shallow waters
- Numerous villas and apartments built for holiday use
- Proximity to Ayia Napa, but with a quieter, family-oriented vibe
- Popular with Cypriots for domestic tourism
Investment Appeal
Protaras offers high occupancy rates from May to September, with many properties commanding €150–€300 per night for villas and €70–€150 for apartments during peak season.
Yields:
- Gross holiday let yield: 7%–10% (seasonal)
- Net yield after costs and occupancy adjustment: ~5.5%–6.5%
Best Property Types
- 2–4 bedroom villas with pools
- Beachside apartments with sea views
- Renovated older homes turned into short-let gems
Challenges
- Highly seasonal demand—difficult to rent during winter months
- Competition from similar short-term units
- Property management and cleaning must be efficient during changeovers
2. Paphos – The All-Rounder with History, Beaches, and Year-Round Appeal
Overview
Paphos is one of Cyprus’ most consistent performers in the holiday let market. Its international airport, UNESCO World Heritage Sites, and all-ages appeal make it ideal for short lets almost all year round.
Popular with British retirees, family tourists, and golf enthusiasts, Paphos offers both lifestyle and investment.
Key Features
- Long-standing British tourist base
- Close to major golf resorts and archaeological sites
- Accessible year-round via Paphos International Airport
- Strong infrastructure, including English-speaking services
Investment Appeal
Unlike more seasonal locations, Paphos benefits from year-round demand, including off-season rentals from expats, digital nomads, and long-stay tourists.
Yields:
- Gross holiday let yield: 6.5%–9%
- Net yield: ~6%–7.5% (due to longer rental season)
Best Property Types
- Detached villas with sea or mountain views
- Townhouses in complexes with pools
- City-centre apartments near the harbour
Bonus:
Paphos has a strong resale market, making it ideal for those seeking capital appreciation alongside rental income.
3. Larnaca – The Underdog Turned Smart Investment Bet
Overview
Long considered less glamorous than its coastal cousins, Larnaca has transformed over the past five years. Thanks to a major marina redevelopment, new beachfront promenades, and expanded flight connections via Larnaca International Airport, it is now one of the most exciting locations for new investors.
Key Features
- Year-round international airport
- Redevelopment of Larnaca Marina and seafront areas
- Growing interest from digital nomads and long-stay tourists
- Excellent infrastructure and value-for-money property
Investment Appeal
Larnaca offers excellent value, with property prices 20–30% lower than Limassol or Paphos. Rental demand is growing steadily, and properties here are easier to rent in the off-season than more seasonal areas like Protaras.
Yields:
- Gross holiday let yield: 6%–8%
- Net yield: ~5%–6.5%
Best Property Types
- Modern apartments in Mackenzie and Finikoudes
- Small villas or townhouses within 5–10 minutes of the beach
- Renovated flats aimed at digital nomads or couples
Advantages
- Lower upfront cost
- Easier entry point for first-time investors
- Less seasonal volatility
4. Ayia Napa – The Entertainment Capital with High Nightly Rates
Overview
Ayia Napa has a reputation as a party town, and rightly so—but in recent years, it has diversified to appeal to families, older tourists, and luxury seekers. With the Ayia Napa Marina project bringing in high-net-worth clientele, the area is shedding its rowdy-only image and embracing upmarket development.
Key Features
- New marina and high-end developments
- Some of the island’s best beaches (Nissi Beach, Makronissos)
- Summer concerts, festivals, and nightlife draw younger crowds
- Strong seasonal rental income
Investment Appeal
Holiday rentals in Ayia Napa achieve some of the highest daily rates in Cyprus, particularly for party-season weekends and villas near the beach or clubs.
Yields:
- Gross holiday let yield: 8%–11%
- Net yield: ~6.5%–8%
Best Property Types
- Modern villas walking distance to the beach or strip
- One-bedroom flats aimed at couples and solo travellers
- Premium apartments in new marina towers
Considerations
- Peak season profitability is high, but occupancy drops sharply after October
- Potential noise and party-related wear and tear
- Ideal for investors seeking high-impact returns in a short window
5. Coral Bay – The Boutique Villa Rental Paradise
Overview
Tucked away on the western coast near Paphos, Coral Bay is a high-end, laid-back haven popular with British and Scandinavian holidaymakers. Its stunning beaches, quiet atmosphere, and luxury villas make it a favourite for week-long or two-week villa stays.
Key Features
- Detached villas dominate the market
- Ideal for family holidays and luxury breaks
- Beautiful beaches and views
- Close to Paphos but quieter and more exclusive
Investment Appeal
Properties in Coral Bay aren’t cheap, but they command premium weekly rates—especially large villas with pools.
Yields:
- Gross holiday let yield: 6%–9.5%
- Net yield: ~6%–7%
Best Property Types
- 3–6 bedroom detached villas with pools and sea views
- Gated properties ideal for high-end family holidays
- Homes with garden and barbecue areas
Advantages
- Wealthier guest demographics
- Less price sensitivity
- Steady demand during school holidays
Challenges
- High property prices (particularly sea view homes)
- Short peak rental window
- Property maintenance and gardening can be costly
Comparative Snapshot: Holiday Let Metrics by Location
| Location | Average Property Price | Gross Yield (%) | Season Length | Airport Access | Investor Type |
|---|---|---|---|---|---|
| Protaras | €250,000 – €500,000 | 7–10% | May–Sep | Larnaca | High seasonal income |
| Paphos | €200,000 – €600,000 | 6.5–9% | All year | Paphos | All-rounder |
| Larnaca | €180,000 – €400,000 | 6–8% | Apr–Nov | Larnaca | Budget smart investor |
| Ayia Napa | €300,000 – €700,000 | 8–11% | May–Sep | Larnaca | High returns, riskier |
| Coral Bay | €350,000 – €900,000 | 6–9.5% | Apr–Oct | Paphos | Luxury villa investor |
Legal and Regulatory Considerations for Holiday Lets in Cyprus
As of 2023, all holiday let properties in Cyprus must be registered with the Deputy Ministry of Tourism and meet specific safety and operational criteria. This includes:
- Fire safety installations
- Minimum equipment standards
- Proof of ownership or lease
- Declaration of rental income to tax authorities
Failure to register may result in fines or delisting from major platforms.
Tip: Work with a local management agency to handle registrations, maintenance, bookings, and guest services if you’re investing remotely.
Final Thoughts: Choosing the Right Location for You
Holiday let investment in Cyprus remains one of the most profitable and lifestyle-rich options in Europe, particularly if you select the right location for your goals and budget.
- Want a high-income summer performer? → Go for Protaras or Ayia Napa
- Prefer consistent year-round rentals? → Choose Paphos
- Looking for affordability and growth potential? → Explore Larnaca
- Interested in luxury villa rentals? → Focus on Coral Bay
Each area has its own strengths, and a successful investment depends on your strategy—short-term gains, long-term appreciation, or personal enjoyment.
At investments.cy, we help match investors with vetted properties in Cyprus’ most promising short-let destinations. Whether you’re buying your first rental or expanding your portfolio, our experts can guide you every step of the way.