In May 2026, Cyprus saw a continued increase in construction material prices, with the Price Index reaching 122.07 units, marking a 1.16% rise from April and a 2.62% jump compared to May 2025. The largest price hikes were observed in metallic products, which increased by 4.31% year-on-year, followed by wood, insulation materials, chemicals, plastics, and electromechanical products.

Despite easing inflationary pressures across Europe’s construction sector, Cyprus faces persistent cost increases, partly due to metal price volatility and energy-related expenses. While Europe benefits from stabilizing supply chains and improving economic sentiment, geopolitical tensions and rising energy costs continue to impact construction budgets.

However, Cyprus’s construction activity remains strong. Building permits for residential units surged by 79.2% year-on-year in early 2026, and the total permit value rose by 56.5%, signaling resilient demand and a solid pipeline of projects despite moderate inflation in construction inputs.