Real Estate Market Sinks by 29%

The turnover of real estate in Azerbaijan in the first five months of 2015 decreased by 29.4%. In annual terms the picture is the same. The market dipped by 29.4% from 2,144,146,000 manats on June 1, 2014 to 1,513,022,000 manats on June 1, 2015.

Thus, if the secondary market decreased by 33.4% to 1,326,727,000 manats, the primary market grew by 22.9% to 186.295 million manats, said the central bank.

Share of intermediaries, which include real estate brokers, notaries and banks in the operations of real estate as compared to June 2014 decreased by 39.4%.

For the year decreased by 10.8% mortgage loans - from 52.7 million to 47 million manats on June 1, 2015. Mortgage lending completely stopped in February after the devaluation of the manat and then brightened slightly.

Experts note the important role of mortgage activity in the housing market and pricing. The subsequent decline in lending, which is more likely in the worsening of banking indicators, will help to lower prices for the real estate market. Prices on the market have now been frozen in anticipation of a "miracle" after the European Games. But the way out of the crisis will not be as fast as in 2009, when the economy was booming. Now the trend is the opposite, so in the autumn we should expect another wave of price cuts, when in need of financial means citizens will start to get rid of illiquid assets. -0-