Cyprus Schengen

Joining the Schengen Area has become one of the major priorities of Cyprus. Through its full membership, the country hopes to boost the economy. Apart from simplifying trading and travel, it can also position Cyprus as a gateway to Europe and strengthen its position as a business hub.

However, there are still a few things that Cyprus needs to overcome. Apart from managing the Green Line, it also has to secure unanimous approval from existing members.

Current Status: Cyprus’s Position Outside the Schengen Zone

Cyprus has been a full member of the European Union since 2004. However, since it’s not fully a member of the Schengen Area, its residents and citizens don’t enjoy border-free travel within most of Europe. They still have to pass border controls instead of freely moving across borders.

Meanwhile, Cypriot visa holders need to fulfill separate requirements for Schengen access. This can make the Cyprus Golden Visa, as well as other residency programs, less attractive for third-country nationals, investors, or students.

Recent Developments: Steps Taken Towards Accession

Cyprus continues to take steps towards joining the Schengen Area, which officially started with the country’s application in 2019. Since then, we have seen the following developments:

• July 25, 2023. Cyprus is now fully integrated into the Schengen Information System. The country issued its first alerts using the SIS, which displays participation in using IT to manage borders and promote security within European countries.
• November 21, 2023. The foreign ministry budget increased by 8.9% to fund the efforts for Schengen accession.
• July 12, 2024. Cyprus issues new obligations to carriers to fulfill requirements under the European Entry-Exit System (EES) and the European Travel Information and Authorisation System (ETIAS).
• January 10, 2025. The president declares that the country will resolve all technical roadblocks to membership.

Assuming there are no issues with evaluation and agreement with existing member-states, Cyprus is expected to fully join the Schengen Area by the end of 2026.

Advantages of Schengen Membership for Cyprus

With Cyprus in the Schengen Area, there is a strong likelihood of seeing these benefits:

• Stronger economic ties. With trade borders being lifted, Cyprus may more easily invite foreign direct investment. Businesses within the country will also be able to access new markets and trade without tariffs.
• Easier travel. Cypriots will be able to travel more easily within the Schengen Area. In the same way, nationals of other countries as well as those with a Schengen visa may see Cyprus as a potential travel option.
• Improved economic cooperation. The accession will encourage cross-border partnerships and projects. And as the infrastructure for trade strengthens, it can support long-term resilience and growth.

However, it is important to note that these benefits may not be fully realized because of the geographic characteristics of Cyprus. Because it’s an island nation, people from other Schengen Zone countries may still not be encouraged to visit.

Cyprus’s Real Estate Market: Effects of Schengen Accession

Schengen membership is expected to have significant effects on the real estate market, specifically on the following:

• Investor interest. As soon as Cyprus joins the Schengen, we expect a spike in investor interest. After all, real estate in the country will be considered an untouched market with potential for improved valuation.
• Property prices. With the rising interest from non-nationals, property prices are likely to increase, especially in metropolitan areas. However, this may be troublesome for locals, if their purchasing power doesn't keep up with the surge in prices.
• Overall market landscape. Even though there’s a potential to have the locals priced out of the market, the generated interest for the real estate market may also create job opportunities. Investors are likely to develop high-end projects to accommodate the increased demand for Schengen residency through property investment.

These changes will not happen the moment that the country joins the Schengen. However, we expect that relatively lower initial prices in Cyprus will put its market on notice for those looking to establish Schengen residency. This, in turn, will generate even more interest that will increase demand and selling prices.

Conclusion

Cyprus is seen to achieve net positive gains with Schengen Area membership. Should the country complete the process, pass all evaluations, and gain approval, we expect an improvement in its economy. With border-free travel and trading, there should be an increased demand for visa programs and even real estate.

However, before these benefits can be realized, Cyprus still needs to address various challenges. The biggest one is the Green Line, a political border that separates Cyprus from the only Turkey-recognized Turkish Republic of Northern Cyprus. 

The current goal is to address these issues and join the EU by the end of 2026. However, if Cyprus doesn't satisfy all the requirements, delays are expected. Another potential outcome is phased integration, where air borders are erased, while their land and sea counterparts remain intact.