AZE.US
Real estate prices are continuing to rise across Azerbaijan’s regions, with land plots, houses and apartments becoming less affordable in areas that were once seen as cheaper alternatives to Baku.
The increase is especially visible in tourism-oriented districts, where demand grows ahead of the summer season. Houses with yards, gardens, clean air and rental potential are attracting both families and investors.
But the same trend is making the market harder for local residents. In Zagatala, a district known for its mountain air and natural landscape, residents say it has become extremely difficult to buy land near the center. One local resident said that even with 10,000 manats, finding a land plot in the urban area is almost impossible.
Cheaper options can still be found in remote villages, sometimes 30 to 40 kilometers from the center. But those locations are not always practical for permanent living or business.
Local real estate agents say the price growth is driven by several factors: high demand, tourism development and the shrinking supply of well-located land plots. Two-room apartments in some apartment buildings are now being offered for around 65,000 to 75,000 manats.
Official figures also point to rising prices in the regions. The highest increases in recent months were recorded in tourism destinations. Prices rose by 3.5% in Gusar, 3.2% in Gabala and 3% in Astara.
In Sumgayit, an industrial center, the increase was 2.5%. In other districts, prices rose by around 1% to 2.5%. The lowest increase among the listed areas was recorded in Jalilabad, at 0.9%.
Experts also point to Nakhchivan, where rising property prices are linked to recent social and economic projects and growing interest in the region.
The reasons go beyond tourism. After the start of the Russia-Ukraine war, construction material prices rose sharply, increasing the cost of building homes. At the same time, demand for land is growing as the population increases and well-located plots become scarcer.
Investment demand is another factor. Many people see real estate as a safer way to preserve and grow their money than bank deposits. Experts note that while deposits may offer returns of around 10% to 11%, part of that income is paid as tax, while property prices in some segments can rise faster.
Specialists acknowledge that brokers and speculative activity also play a role, but they do not consider them the main driver of the current increase.
The pressure on the market comes despite a long-standing problem in the regions: limited job opportunities. Lack of employment has pushed many people toward Baku for years. Now, even those who want to stay in their home district or build a house there are facing prices that are increasingly difficult to match with local incomes.
Experts say regional economic development and a larger housing supply are needed to ease the pressure.
The State Housing Construction Agency said 9 preferential housing projects have already been launched in the regions, with a total of 5,361 apartments planned.
Still, the outlook remains difficult for buyers. Experts expect apartment prices to rise by around 12% to 15% this year, depending on the segment, while land plots could become up to 20% more expensive.
That means regional real estate is increasingly turning from an affordable option for local families into an investment asset. For those hoping to buy land in their home district, the window is getting narrower.
AZE.US