Stock of un­sold lux­ury apart­ments rises

Ekaruna - - Cover Story -

In ad­di­tion to sub­dued de­mand, the shift to­wards smaller, more af­ford­able residential units was fur­ther em­pha­sised by the lack of for­eign in­vestors, whose pur­chas­ing power usu­ally sur­passes that of lo­cals. For­eign in­vestors, con­sist­ing pri­mar­ily of wealthy busi­ness­men from the Gulf coun­tries, con­tin­ued to shy away from the Le­banese mar­ket in 2014. The num­ber of real es­tate trans­ac­tions by for­eign­ers ac­counted for only 1.5 per­cent of the to­tal real es­tate deals in the first nine months of 2014, com­pared to 1.8 per­cent in the same pe­riod of 2013 and 2012.

For­eign­ers fi­nalised 795 real es­tate trans­ac­tions in the first nine months of 2014, down 12 per­cent from 903 deals dur­ing the same pe­riod in 2013. The num­ber of sales trans­ac­tions to for­eign­ers fell by 8.3 per­cent in 2013.

The de­vel­op­ers that Ekaruna mag­a­zine in­ter­viewed unan­i­mously agreed that buy­ers from the Gulf re­gion were nowhere to be found in 2014, a sit­u­a­tion that left many de­vel­op­ers of spa­cious lux­ury apart­ments in Beirut with a sig­nif­i­cant stock of un­sold residential units.

A study con­ducted by Ramco Real Es­tate Ad­vis­ers on 65 projects com­pleted in Beirut in 2013, with the start­ing sales prices of first­floor units ex­ceed­ing US$ 2,800 per square me­tre, re­vealed that 277 com­pleted apart­ments have not been sold by the end of 2013.

How­ever, Beirut main­tained the high­est share of the to­tal value of sales in the first nine months of 2014 at 28.2 per­cent, com­pared to 25.6 per­cent dur­ing the same pe­riod of 2013.

The av­er­age value per real es­tate trans­ac­tion across Le­banon in­creased by 6.1 per­cent year on year to $128,382 in the first nine months of 2014, rel­a­tive to av­er­age val­ues of $120,990 in the same pe­riod of 2013 and $118,044 in the first nine months of 2012.

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