Inflation affects the growth of wages of private builders

Average prices for apartments in the primary housing market segment (PHM), both in Baku and in the regions, fell in August compared with July, 5%. Prices for private building, by contrast, grew at the same rate, despite a slight reduction in price of construction materials. Here played the role of inflated wages of masters that influenced the cost of the final product.

According to "wild" brokers (without the status of business), the reason for reduction in price in the apartment buildings segment is the relative saturation of the market. Expelled from their homes residents of the streets Fizuli, Shamsi Badalbeyli, Mirzaaga Aliyev, Academician Topchubashov and the former Soviet streets were divided into two categories - those with large usable area by compensating for 1500 manat per square meter bought apartments (mostly secondary housing) on ​​the periphery of the capital. Holders of a small area moved into the category of tenants live in anticipation of a mortgage loan. Another reason is the fall in demand for background processes, but the decrease is not significant buying interest - by 10-12%, according to local brokers.

Still, prices are very high on the background of real food inflation that worries most disadvantaged layers of the population. As of September 1, by tradition greatest demand was for one-and two-bedroom apartments, "under the lighthouse" on the outskirts of towns and in the capital at a price 550 manats ($ 700) per square meter. This is the average price for a small spread in comparison with housing in the city center. Most one-bedroom apartments - from 60 to 85 square meters of floor area, one-bedroom apartments - from 85 to 105 sq. m. Luxury accommodation in the city center (from 3 000 to 40 000 per sqm) is designed for the wealthy and is sold in advance. Developers and builders of this type of objects (e.g., Pasha Construction LLC with mixed object "Port Baku Residence") refer to the top of the business of the ruling family, because apartments and offices where the most expensive in the capital segment of the primary housing.

Compared with the beginning of the year, prices still rose by 10% and in comparison with the same period last year by 14.7%. The highest peak of activity occurred in the first two quarters of 2008, when prices were higher than the current 25-30%. Referring to the surveys of realtors and brokers, there is a surprising drop in demand at increasing opportunities for mortgage loans. Banks democratized the process that was a closed one before, and now on the financial support, designed for 15-25 years, can expect even some categories of teachers and doctors, whose official salary is low, and the age of the original ceiling exceeds 40 years. The maximum credit is 50 000 manats, which allows paying for not renovated apartments.

So-called middle class family (4-5 people) budget of more than 1500 manats per month prefer, as in Soviet times, two-bedroom apartments with constant utilities (heating, electricity, natural gas, garbage collection, etc.). Fairly renovated accommodation (from 105 to 140 square meters) of this type costs around 850 manats per 1 square meter. In addition, this category of the population gets the apartment buildings, taken into operation MOE and having, in addition to the certificate of acceptance, documentation, including data sheets, of the State Property Committee.

The most attractive parts of the capital during August were Khatai, Nizami and Sabunchu districts. Previously the leadership was held by the Yasamal district, but the demolition of houses in the area changed its vector. Last month, the number of proposed newly built private houses was 495, and the number of construction companies has dropped from 115 to 108. As one of the realtors told Turan, previously owned a construction company, the rise in prices in the primary market due not only to the reduction of the number of players at the construction sector pressure monopolists, but the general trend of post-crisis growth of prices in these markets. Due to the mortgage also increased the purchasing power of the population since the beginning of the year.

Negatively to enhance PHM on the following factors: lack of documentation to make the sale, the lack of gas, the presence of the majority of apartments with a large area, as well as the monopoly. In addition, the primary housing, basically, does not meet the mortgage - says an experienced specialist. According to him, today monopolists prefer to build houses and identifying them with "premium" to maintain a high price level in the segment. In the majority of buildings there are a low proportion of single-family apartments, which means ignoring the interests of the consumer. Previously, developers "chased" for European and Soviet project "People's House", now they saluted the concept of "luxury".

According to him, the unpopular compared to the secondary housing market, this segment will continue to maintain a high level of prices due to monopoly control. The Government needs to monitor and draw the appropriate conclusions, - he said. Otherwise, the poor will either be the end of life in other people's apartments huddle or be illegal to build and attractive homes in the territory of the state oil company and other natural monopolies. --17D-