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Review of construction sector in Azerbaijan (January-May 2017)

Analysis Materials 17 July 2017 17:19

Most of construction work accounted for primary construction, reconstruction and expansion in January-May 2017, the Azerbaijani State Statistics Committee said.

Some 68.1 percent of the total volume of construction work accounted for primary construction, reconstruction and expansion, 9 percent - overhaul, 4.4 percent - current repair and 17.5 percent - other construction work.

Some 87.6 percent of the total volume of construction work was carried out by non-state construction companies.

According to the Azerbaijani State Statistics Committee, housing commissioning increased by 13.6 percent in Azerbaijan in January-May 2017 compared to a 13-percent-decrease in 2016.

The annual growth rate lasts for the last two months.

Some 123,200 square meters of housing were commissioned in Azerbaijan in May 2017 compared to 121,000 square meters in April 2017 and 110,800 square meters in May 2016.

Some 629,700 square meters of housing were commissioned in Azerbaijan in January-May 2017 compared to 554,500 square meters in the same period of 2016.

Real estate market

According to the MBA Group consulting company, prices increased by 1.37 percent in Baku’s real estate market in May 2017. Activity has been observed in the market since early 2017, which continues despite summer.

The prices increased in all sectors as of May, with the exception of the prices in the commercial property market and commercial property for lease.

Thus, the prices in the commercial property market declined by 1.22 percent, while commercial property for lease by 2.88 percent during the reporting period.

The biggest growth was observed in the housing market, and the smallest - in the land market.

Thus, prices increased by 5.04 percent in the primary housing market in May and by 3.81 percent in the secondary market. Prices increased by 2.96 percent in the rental market, while by 0.08 percent in the land market.

The prices in the real estate market may increase by ten percent in 2017.

The gradual adaptation of the population to the current situation and the restoration of the activity of the Azerbaijan Mortgage Fund (AMF) may contribute to it.

The prices in Baku’s real estate market in dollar terms decreased by 31.53 percent in 2016.

The prices on land plots increased by 0.6 percent in Baku in May.

Construction material market

According to the Azerbaijani State Statistics Committee, the construction materials worth 189.1 million manat were produced in January-May 2017, which is by 41.4 percent more than in January-May 2016.

Cement production increased by 24.8 percent up to 1,044.5 tons, the production of precast concrete building structures – by 3.4 times up to 73,100 tons, ready-mixed concrete – by 21.4 percent up to 227,000 tons.

The production of bricks increased by 46.1 percent up to 108,100 cubic meters, processed marble, travertine, alabaster and items made of them – by 2.7 times up to 4,144.1 tons, building blocks and cement bricks, artificial stone bricks or concrete bricks – by 1.5 percent up to 32,252.2 tons.

The production of gypsum plaster decreased by 16 percent up to 42,500 tons, asphalt - by 68.8 percent up to 66,200 tons, building lime – by 12.2 percent up to 9,254.4 tons in January-May 2017, the report said.

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