Prices fall in secondary real estate market

The average cost of the secondary real estate in Baku fell by 2.3 percent to $ 1,030 per square meter in the first quarter of 2017, compared to the previous quarter.

Prices for economy-class apartments in the secondary market fell by 3 percent, to $818 per square meter, while comfort-and businessclass housing slightly increased. So, the cost of comfort-class accommodation reached $1.417 per square meter (growth by 0.35 percent in a quarter), and business class - $2.231 per square meter (1.38 percent).

Roughly 7,390 apartments were put up for sale in the first quarter of 2017, which is 4.41% less than in the fourth quarter of 2016. Also, only 31.5 percent of them are put up for sale for the first time, the rest was already offered in the previous quarters. Despite the reduction in the number of advertised apartments, the volume of transactions for their purchase and sale in the quarter slightly increased-by 2.45 percent to 2,534 deals.

As for the structure of apartments, most of them (30.48 percent) are three-room apartments. Then follows two (29.49 percent), four (17.57 percent) and one-room (14.3 percent) apartments. The share of multi-room apartments (five rooms and above) accounts for only 8.16 percent of the offers.

Most of the apartments offered for sale in the secondary housing market of Baku are located in Nasimi district - 26 percent, in Yasamal district a bit more than 20 percent, Binagadi, Khatai and Sabail districts – 10 percent.

The general director of the consulting company “MBA Group”, Nusret Ibrahimov, recently said that the ongoing reconstruction projects in Baku will revive the real estate market.

“The construction sector is developing and this contributes to the increase of employment and activization of the construction materials market. In the end, all this leads to the fact that people receive additional income, which, in turn, is returned to the real estate market, thus, the real estate market is becoming more active,” said Ibrahimov.

President Ilham Aliyev, addressing a recent meeting of the Cabinet of Ministers, said that this year there is a revival in the construction sector.

“More than 300 new multistorey buildings are under construction in Baku now. This in itself is an excellent indicator. Thousands of jobs are created here. Last year, we lost most of the jobs in the construction sector. This year they are being restored,” he said.

Today, the share of the construction sector in Azerbaijan’s GDP amounts to about 10 percent.

The government plans to achieve a GDP growth by 249 million manats ($ 141.2 million) until 2020, through the implementation of measures envisaged in the Strategic Road Map for the development of housing provision at a reasonable price.

The Road Map comprises shortterm (until 2020), medium-term (until 2025) and long-term measures (post 2025) to be implemented in the sphere. Some 900 million manats ($493.09 million) are planned to be spent for the implementation of the measures. Under the Road Map, some 10,000 new jobs will be created in the construction sector of the country.