Azerbaijan’s Real Property Market Experiences Stagnation Period: Expert

Business Materials 7 November 2008 14:49 (UTC +04:00)

Azerbaijan, Baku, 7 November / Trend , corr. U.Ismayilova / The worldwide financial crisis has frightened buyers of real estate, and they decided to wait for the forecasted reduction in the cost housing prices," Nusret Ibrahimov, the General Director of consulting company MBA Group, said.

"Seeing the situation, we can say that the Azerbaijan's real estate market is experiencing a period of stagnation," Ibrahimov added.

In October, the housing prices rose by 1.2 per cent in the primary market, by 2.39 percent in the secondary and by 0.83 percent on the rent market. However, one percent reduction was observed on the land market, building materials cheaper by 0.5 percent and the prices on the commercial properties rental market fell by 2.8 percent.

According to experts, the market activity was very weak in October. Even the secondary housing market, which began to increase in summer, today declined due to some local banks have suspended the issue of consumer loans. Currently, a number of banks has restored consumer lending.

According to Ibragimov, the demand also declined in the primary market. But it was not caused by the financial crisis, but because of great risks associated with delays in delivery of housing and sharp price changes.

The land market is also going through a period of stagnation due to the construction of a building is cost more expansive than compared to previous years, Ibrahimov added.

"The fall in prices is logical to expect in such a situation, I think, this will not happen in the next several months, but may be restored to September 2009," Ibrahimov noted.

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