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Price rise in primary house market of Azerbaijan continues - MONÄ°TORÄ°NG

Price rise in primary house market of Azerbaijan continues - <span style="color: red;">MONÄ°TORÄ°NG

09 December 2013 14:05 (UTC +04:00)

Property Market Participants Pu told APA-Economics that though the reasons of price rise were different in several months, the main factor is high demand in the real estate market. Demand for houses increased as the purchasing power went up on he background of decline of supply.

Due to 80% of houses purchased through mortgage belonged to secondary market, the demand is in this segment that growth observed in old houses. At the same time, as these houses directed to mortgage are pledge, their circulation is impossible for 25 years. Consequently, it causes decrease n the real estate market. This increases demand at the primary house market.

Regarding primary house market, though there are problem on providing with communal services and documentation, it does not decline demand for house fund. Because of the supply, especially supply at a suitable price (600-700 AZN / m²) fell and influenced price rise. According to November’s monitoring in primary market, same dynamics continued. Last month, sale and purchase of new buildings faced both activity and price rise. Demand for house with full communal condition, 2-3 rooms, and mid-storey houses in the worth of 800-1,000 AZN/m² was higher in November.

Consequently, price rise in primary house market was 2.1%.

2 new buildings have been withdrawn from the sale in Narimanov and Khatai Districts. At the same time, 2 new buildings have been put to sale in Nizami and Narimanov districts. So, number of buildings remained unchanged at 395. Number of construction companies dropped to 122 from 123.

According to monitoring, the prices n primary house market rose. So, average price of 1 m² in the new buildings rose 2.1% to AZN 921.9 from October’s AZN 902.5. Copmared to a quarter ago price rise was 4%, a year earlier – 13.1%.

Note that compared to September, 2008, the prices dropped 22.8%, rose 9.8% compared to the beginning of this year. Average price rose 2.1%, price index increased by 7.2 points to 351.6 points from 344.4 points.