AZE.US
Baku’s real estate market continues to move upward, with demand increasingly shifting from the traditional city center toward new urban clusters such as White City, Port Baku and Sea Breeze.
Akim Tahirov, CEO of Etazhi Azerbaijan, said in an interview with Ignat Bushukhin’s real estate channel that the capital’s property market is no longer centered only around historic Baku. While central districts remain prestigious, buyers are increasingly looking at large-scale developments with stronger infrastructure, better planning and higher investment potential.
According to Tahirov, the most prestigious parts of Baku remain Sabail, parts of Nasimi and parts of Khatai district. However, he said the market’s center of gravity has shifted in recent years.
“Now it has moved more toward Port Baku and White City,” he said.
White City, built on the site of a former industrial zone once known as Black City, has become one of the most important new development areas in Baku. The project includes residential buildings, roads, commercial areas and separate urban clusters. Tahirov described it as one of the most expensive and attractive locations in the city when viewed as a full development cluster.
At the other end of the market, the more affordable districts include Surakhani, as well as areas outside Baku proper, including Khirdalan and Masazir. For young families buying their first apartment, these locations often remain among the most realistic options.
Prices on the secondary market vary sharply by district and building type. A one-bedroom apartment in Soviet-era housing can start from around $70,000 to $80,000. In some better-located Khrushchev-era buildings, prices can reach as high as $150,000.
Tahirov said buyers are increasingly cautious about Khrushchev-era apartments because of the age of the buildings, limited mortgage options and concerns over their remaining useful life. Stalin-era buildings remain more popular due to higher ceilings, thicker walls and more comfortable layouts.
A separate segment of the market consists of so-called pilot projects, where old Soviet apartment blocks were demolished and replaced with new buildings. These projects became active around 2014-2015, particularly in Narimanov, Nasimi and parts of Yasamal district. Apartments in such buildings can start from about $120,000.
In new developments, the cheapest units at the construction stage start from around $1,200 per square meter. Apartments with renovation begin at around $1,500 per square meter. Mid-market properties can cost between $2,500 and $3,000 per square meter, while elite apartments start from about $6,000 per square meter.
The most expensive apartments in Baku can reach around $3 million. Tahirov cited a 375-square-meter apartment with renovation and sea views in the Crescent area as an example.
Buyers of high-end property are mostly businesspeople, as well as Azerbaijanis who live and work abroad. Tahirov also pointed to a newer group of buyers: IT specialists with high incomes from international companies.
Foreign demand is also visible, especially from Russian and Kazakh buyers. After 2022, some Russian investors began viewing Azerbaijan as a market for preserving capital. Tahirov said Baku has been attractive to such investors because prices have grown and properties remain relatively liquid.
For many investors, however, rental income is not the main reason to buy. Most new-build apartments in Baku are sold without renovation. Tahirov estimated that 80-90% of primary-market properties are offered with bare walls. In some cases, he said, investors prefer to buy early and wait for capital growth rather than spend additional money on renovation and furniture for rental purposes.
Rental yields in Baku city are usually around 3-5% annually. In resort real estate, particularly in Sea Breeze, returns can be higher, around 6-8%, if the property is managed properly and used for short-term rentals.
A one-bedroom apartment in a residential district of Baku can be rented from around $400 per month. Closer to the center, rents can rise to $800-1,200 per month. A good renovated two-bedroom apartment in central Baku may cost around $1,000 per month.
Sea Breeze has become a separate market of its own. Tahirov said it began as an alternative to traditional summer houses but is now gradually turning into a full-scale resort city. Buyers there purchase studios, serviced apartments, family apartments and villas.
There is one important restriction for foreigners: non-residents of Azerbaijan cannot own land. For villa buyers, this means the land may be held through long-term lease arrangements or the property may be purchased through a legal entity.
Mortgage and installment options are also shaping the market. Tahirov said Azerbaijan has state-backed mortgages at around 8% annually, preferential mortgages for certain categories such as military personnel and public-sector employees at around 4%, and commercial bank mortgages that may reach 11-13%.
But in new developments, internal installment plans from developers play a major role. According to Tahirov, at some projects up to 80% of transactions are completed through developer installment plans. These options are also available to foreign buyers.
The commercial property market is being driven by cafes, restaurants, coffee shops, supermarkets and pharmacies. Income-generating retail spaces with long-term tenants are also becoming more attractive to investors.
Tahirov said the broader trend is clear: Baku real estate is no longer viewed only as a place to live. Apartments, resort properties and commercial spaces are increasingly seen as a way to preserve capital. With construction rules becoming stricter, supply more controlled and demand still strong, prices in key areas of the city continue to rise.
AZE.US