Azerbaijani Real Estate Market Lives Period of Stagnation: Head of State Register Service

Business Materials 7 July 2008 15:03 (UTC +04:00)

Azerbaijan, Baku, 7 July /corr. Trend U.Ismaylova / The real estate market of Azerbaijan lives the period of stagnation, the Head of State Real Estate Register Service of Azerbaijan, Arif Garashov, said on 7 July. Accordig to Garashov, the basic factors affecting the activity of market are strengthening of growth rates in the prices, and also seasonal summer period. Since the beginning of the year, the price in the real estate market of Azerbaijan grew by 20%. In May one sq.m of housing are in Baku averaged $1834.

Garashov said that another reason for temporary stagnation in the market is the fact that large part of population already acquired real estate, and after Azerbaijan Mortgage Fund re-establishes providing mortgage credits, the remaining part of population will be able to be get houses. In summer 2007, Azerbaijan Mortgage Fund stopped providing mortgage credits because of lack of finance. The 2008 Public allocated AZN 56mln for the Fund. Yet the Fund has not re-established mortgage underwriting.

" Azerbaijan was also affected by the world price increase for energy resources, which in turn led to increase in the prices of construction materials," said Garashov.The activity of the real estate market reduced by 34% after the collapse of the constructed 16-storey building in August 2007 in one of the central streets of Baku, as a result of which 25 people died. After the incident, the real estate market began to gradually activate after the beginning of the year.

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