Azerbaijan has temporarily stopped accepting new applications for homes under its rent-to-own program, while a property appraiser has warned that a prolonged pause could push ordinary residential rents up by 10% to 15%.
The Mortgage and Credit Guarantee Fund suspended applications from Oct. 6 after demand rose sharply. The fund said it plans to improve the electronic system so applications can be accepted, processed and assessed more quickly and transparently.
More than 100 applications had recently been registered each day, and the number of applicants who had received appointment times was many times greater than the number of homes available for selection, according to the fund’s official notice.
Between 2020 and 2026, more than 10,000 rent-to-own contracts were completed for homes at 17 addresses in Baku, Sumgait and the Absheron district. More than 12,000 people have also received notices specifying appointment times.
The suspension does not affect applications registered before Oct. 6, their place in the queue or procedures already underway, the fund said.
Applications Could Resume Within a Year
Vugar Oruj, chairman of the Azerbaijan Society of Appraisers, told Bizim.Media that he expects the program to resume after the system’s functionality and application process are improved. He said that could happen within the next year.
Oruj said projects and apartments are planned for the program and argued that a lengthy suspension would be unacceptable for both the real-estate market and the parties involved.
Home Sale Prices Unlikely to Rise Immediately
Oruj said a short pause was unlikely to have a serious effect on home prices because the rent-to-own program and the conventional sales market largely serve different groups of buyers.
People temporarily unable to use the program may not be able to purchase homes immediately on regular market terms, he said, limiting the number who shift directly into the sales market.
Oruj estimated that homes provided through the mechanism over the past five years represented about 5% to 6% of Azerbaijan’s overall housing market.
Longer Pause Could Lift Ordinary Rents
The risk would increase if the suspension lasts for an extended period and no alternative social-housing projects emerge, Oruj said. Some demand could then shift to the regular home-sales and rental markets.
He estimated that stronger demand for ordinary rental homes could raise rents by about 10% to 15%, depending on the duration of the pause and the balance between supply and demand.
The forecast applies to residential rents, not apartment sale prices.
Additional background on the suspension and program totals is available in Bizim.Media’s earlier report.
Source: Vesti Baku