Construction sector (january-april 2010)

According to the Azerbaijan Realtors Association, 20-30 percent growth was recorded in operations in Baku housing market due to the demolition of the old damaged buildings over recent months. Many residents of the demolished houses already received compensation and are looking for a new home.

The resumption of the mortgage loans also affected the growth of operations on the housing market in Baku because averagely 20.30 mortgage loans are provided per month.

In January-April the amount of construction works increased in Azerbaijan by 18 percent, totaling 958.7 million manat. The construction works in the public sector amounted to 307.1 million manat during the year, in the private sector - 651.6 million manat.

Of the total construction works, 675 million manat or 70.4 percent account for the primary construction, reconstruction and expansion, 183.2 million manat or 19.1 percent - capital repair, 55.6 million manat or 5.8 percent - current repair, 44.9 million manat or 4.7 percent - other construction work.

Total area of residential buildings put into use in Azerbaijan in January-April made up 413,400 square meters, which is 13.7 percent more than the same period of last year.

1.152 billion manat was invested in the construction of production facilities or 20.6 percent more than the same period of 2009, 1.138 billion manat (6.4 percent less) in the facilities in the service sector.

Total investments in the main capital amounted to 2.291 billion manat, increasing by 5.5 percent during the year.

First housing market

In April, prices on the primary housing market in Baku did not change and remained at the March - $880, Participants of Property Market public organization said.

Based on the monitoring results, significant changes were not observed in prices and volume of transactions for the purchase and sale of objects, as the real buyers prefer the secondary housing.

The apartment area constructed in the primary housing market amounted to 122.2 square meters compared to 121.9 square meters in March and average units - 2.5 and average floors - 15.2.

Four new buildings appeared in the market in April, three of which were built in Sabail and one - in Binagadi district of Baku. The number of building companies operating in the market was 152 in April compared to 150 - in March. Thus, the number of buildings under construction has grown from 434 to 438.

Most of the buildings were built in Yasamal, Khatai and Nasimi districts of Baku, which amounted to 65.6 percent of the total number of buildings under construction.

The greatest demand in the primary housing market was observed at the three-room apartments. Five-room flats are offered mainly in the central zone of the city first and one-room - in the third zone.

Second housing market

Prices on the Baku secondary real estate market decreased by 1.3 percent to $1,146per square meter in April compared to $ 1,161 in March, the Property Market Participants public organization.

In April, price rise was not observed in any district, but drop was recorded in Nizami District of Baku (1.3 percent).

In April, the share of the second real estate market offered at prices lower their average price made up 59.1 percent. The share of newly-built buildings on the secondary market decreased by 0.4 percent to 61.2 percent compared to March.

In April, the average price of one room totaled $45,456. The average price of apartment made up $118,876.

In April, proposal on the market reduced by 0.9 percent compared to March. About 6,600 apartments were proposed on the market compared to 6,700 in March. Most of the portfolio of the market (80.3 percent) fell to apartments, offered in Yasamal, Nasimi, Narimanov and Khatai districts of Baku.

The share of the Binagadi district in the portfolio in this segment of the market amounted to 7.9 percent, Nizami - 5.2 percent, Khazar (former Azizbayov district) - 0.6 percent, Sabayil - 4.2 percent, Surakhani - 0.8 percent, Garadagh - 0.3 per cent.

The share of the one-room apartments on the market in April was 14.6 percent, two- room - 37.3 percent, three-room - 39.3 percent and four-room- 8 percent, five-room - 0.8 percent.

In April, the dynamics of transaction on the secondary residential market in Baku reduced by 0.5 percent.

Land market

Average price for land in Baku in April reduced by 1.2 percent up to $14,265 compared to $14,436 in March, "Participants of property market" public organization said.

The most significant price-cutting by 1.6 percent was in the Sabail district of Baku. The prices of land in the Khazar (former Azizbayov) district of Baku increased by 0.2 percent in connection with the summer season.

Exposition of land was increased by 0.8 percent up to 255 days in April.

The most expensive land in April was proposed in Nasimi district of Baku at $250,000 per one hundred square meters, the cheapest - in the Absheron area costs $350 per hundred square meters.

In total, land market of Baku proposed 800.1 acres of land, of which 77.6 percent were vacant.

Building materials

In April, the building materials, including wood, construction sand, gravel and other materials, electric water pumps, as well as security systems, were sold well in Baku. It is connected with increased demand for building materials due to torrential rains and mudslides in some districts of Azerbaijan. The increase of the activity of this market segment is forecasted due to the construction work in the disaster zone at the next stage.

Last month, the monitoring was conducted among 38 items and 89 varieties of building materials. The share of local production of building materials last month was 53.9 percent. The increase in prices last month was observed only on imported building materials, particularly materials of iron. Locally produced goods were unchanged in price.

During the month, import of Iranian glass was replaced by Russian. According to experts of the organization, for the last year, import of Iranian construction materials, which comprise the major part of imported materials, fell by 0.5 percent.

Prices increased on 12 kinds of building materials:

Prices fall on the three types of building materials:

Prices for other types of construction materials remained stable.

Prices increased by 1.6 percent compared to March, the previous month - by 20.1 percent, the same period of the last year - by 57.4 percent, the report said.

Commercial facilities

In April, the prices on the market of commercial facilities of Baku fell by 0.3 percent, for lease of commercial facilities by 0.2 percent.

The average price of non-residential facility in Baku in April amounted to 2,970 dollars compared to 2,980 dollars per square meter in March.The prices dropped 0.4 percent compared to the previous quarter, 3.1 percent compared to the same period of 2008.

Proposals in the market of commercial facilities last month fell by 3 percent, which is related with the beginning of the summer period.

The share of commercial facilities, proposed on the market below the average price comprised 54.4 percent of the total market portfolio.

Price rise in April were not observed in any districts of Baku, a significant decrease was observed in the Sabunchi district - at 0.8 percent.

Summary table of prices in zone of the city: