AZE.US
Azerbaijan’s real estate market is seeing a new investment trend: buyers are looking beyond Baku apartments and turning to homes in regions with strong tourism potential.
For years, apartments in the capital were the main choice for people investing in property. That pattern is now changing, according to local real estate experts.
More buyers are considering homes in Gabala, Ismayilli, Lerik, Lankaran, Khachmaz, Gusar, Guba and Absheron, where tourism activity has increased and rental income may be stronger during the season.
Experts say the appeal is simple. Buyers want property that can be used both as a place to rest and as a source of income.
Many of those purchasing homes in tourist areas do not live there permanently. Some live in Baku, others are based outside the country. Their goal is to buy in locations where rental demand is relatively high and where the property may gain value over time.
The shift is also linked to rising real estate prices in Baku. As apartments in the capital become more expensive, the amount needed for investment grows, while the payback period becomes longer.
That is pushing some buyers to search for lower-cost properties outside the capital, where they hope to earn income faster.
Experts say one key indicator is rental yield. If annual rental income equals about 5% of the property’s value, the purchase can be considered a reasonable investment. If the return is below 5%, the property becomes less attractive as an investment tool.
The future increase in the value of the property also matters. In tourism regions, that depends on roads, infrastructure, visitor numbers, seasonal demand and the overall development of the area.
Real estate specialists expect interest in regional property to continue in the coming years. But for buyers, this is no longer just about buying a country house for weekends. Increasingly, it is an attempt to find an investment asset outside Baku’s expensive housing market.
AZE.US