PremiumReview of construction sector in Azerbaijan (Jan.-Aug. 2012)

According to the Azerbaijani State Statistical Committee, the volume of construction work in Azerbaijan increased by 34.9 percent in January-August 2012 compared to the same period of last year.

In particular, the volume of construction work carried out by state-owned companies hit 24.7 percent of the total amount of work, while private companies - 75.3 percent.

Some 73.2 percent of the total volume of construction work fell to the primary construction, reconstruction and expansion, 14.1 percent - overhaul, 2.3 percent - current repair, 10.4 percent - other construction work.

In August, compared to July, volume of housing commissioning in Azerbaijan increased by 15.9 percent, and compared to August 2011 - by 2.1 times. According to the Azerbaijani State Statistical Committee, in August, 145,900 square meters of housing were commissioned compared to 125,300 square meters in July and 68,900 square meters in August 2011.

Some 1.067.9 million square meters of housing were commissioned in January-August 2012 compared to 1.087.4 million square meters in April. A 1.8 percent -decrease was observed in these volumes.

Primary residential market

According to the "Property Market Participants" public organization, prices in August remained unchanged. A similar situation occurred in the major cities of the country. At present, the average price index is 802.3 manat per 1 square meter. Compared to the previous quarter, prices fell by 2.3 percent, and compared to last year - 4.1 percent.

During the month the most attractive districts of Baku was Yasamal, Khatai and Nasimi.

Secondary market

Price on the secondary housing market in Baku in August 2012 increased by 1.3 percent and amounted to $993 per square meter.

During the month an increase in prices was observed in Khatai district (by 3.2 percent).

In August, the volume of supply on the secondary housing market increased by 0.9 percent. The supply on the market reached 7,700 apartments in August.

The share of Yasamal, Nasimi, Narimanov and Khatai districts in the portfolio of supply on the market amounted to 78.7 percent. The formation of the portfolio due to these four districts for a long period is connected with new buildings built in these districts on the market. The research shows that the portfolio is mainly formed due to these four districts on the primary market.

The extended table of average prices per square meter of living space has been prepared on the basis of the "Property Market Participants" public organization's data.

The prices as of August 2012

Building materials

In August 2012, prices in the building materials market decreased by 0.22 percent compared to the previous month. Compared to early year the average price dropped by 1.4 percent, while compared to the same period in 2011 increased by 4.1 percent. The share of domestic products in the total volume of construction materials hit 53.5 percent.

Monitoring was conducted on 37 items and 88 types of building materials.

The summary table shows construction materials, prices of which decreased (in percentage):

Land market

The average price of one hundred square meters in Baku in August increased by 0.5 percent - from $14,895 to $14,967. In August, land price increased in many districts of Baku. The biggest rise in prices was observed in Binagadi district (1.7 percent). Binagadi and Garadagh districts were the most active on the land market. The most passive was Narimanov district.

According to the information, the most expensive land plot was offered for sale in Nasimi district at a price of $350,000 per one hundred square meters (a place near the tea factory), and the cheapest one was offered for sale in Absheron district - in settlement Pirekeshkul - at a price of $350 per one hundred square meters.

In August, Baku's land market offered for sale 742.0 hectares of land, 80.7 percent of which were empty plots and the rest were uninhabited and old inhabited plots.

Commercial market

In August, in the market of non-residential buildings in Baku average price of property and cost of rental housing used for commercial purposes increased over the last month, respectively by 0.3 percent and 0.4 percent.

The average price per square meter of non-residential area in Baku in August hit $2872 compared to $2864 in a month earlier. According to the studies, price compared to the same period of 2011 increased by 0.4 percent, compared to the previous quarter - by 0.2 percent.

No increase in the price of non-residential facilities was obsreved in any districts of Baku, and major decline occurred in Binagadi district of Baku - by 0.4 percent.