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Real estate prices decrease in Azerbaijan

18 May 2016 10:00 (UTC+04:00)
Real estate prices decrease in Azerbaijan

By Nigar Abbasova

Real estate prices in Azerbaijan slightly decreased in April 2016. Prices in real estate market have decreased by more than 3.59 percent in manat terms (0,52 percent in dollar terms) as compared to prices fixed in March 2016.

The CEO of MBA company and real estate expert Nusret Ibrahimov said that the prices in the primary housing market have decreased by 2.24 percent (1.02 percent increase in dollar terms).

Prices in the secondary housing have decreased by 1.57 percent (1.71 percent increase in dollar terms). Prices of plots of land have decreased at the average of 1.73 percent in manat terms, while prices in dollar terms have increased by 1.55 percent.

“The highest activity is observed in the land plots market, this is due to the start of the summer season. Nevertheless total activity in the real estate market has decreased by 7-8 percent,” Ibrahimov added.

Decrease in activity in its turm contributed to the extension of exposure time. “Previously exposure time in real estate market was approximately 111-112 days, currently it is 115 days,” he added.

The highest decrease was observed in the market of commercial property, where prices have decreased by 8.83 percent in manat terms while decrease in dollar terms amounted to 5.79 percent.

“Rental charge for commercial property in April faced decrease at the average of 6.75 percent in manat terms (3.64 percent in dollar terms), housing rent payments have decreased by 2.3 percent (0.96 percent increase in dollar terms),” the expert said.

He added that the recent increase observed in oil prices has slightly influenced stabilization of prices in real estate market. “Changes in oil prices are currently insignificant, and unable to influence drastically the market. It may have increased impact only after reaching definite oil prices which amounts to $50-60 a barrel,” expert said.

Ibrahimov added that there is no direct relation between oil prices and real estate prices but the former may influence real estate prices by means of a number of factors which are “black gold” dependent. These factors include money stock, exchange rate, GDP growth rates, employment rate and inflation.

Prices in Baku’s real estate market in March 2016 decreased by 1.96 percent in manat terms (0.31 percent in dollar terms) as compared to February 2016. Prices in the primary housing have increased by 1.41 percent in manat terms (0, 31 percent in dollar equivalent), while prices on secondary housing have increased by 3.84 percent (3.43 percent in dollar equivalent). Since the start of the year prices in manat terms have increased in both markets by 20.54 and 0.3 percent respectively, prices in dollar terms have decreased by 18.27 and 30.24 percent respectively.

Prices in the commercial property market in March 2016 have decreased by 8.55 percent in manat terms (6.23 percent in dollar terms) as compared to the rates observed in February 2016.

The average apartment cost per square meter in Baku city centre currently amounts to approximately 2,480.94 manats ($1,652.25). Prices outside of centre are 950.26 manats (632.85 in dollar equivalent).

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