Center for Economic Research and Reforms assessed the level of demand in the real estate market in Uzbekistan

In July this year, the number of concluded real estate contracts amounted to 18.1 thousand, which is 12.5% more compared to the corresponding period of 2020. At the same time, compared to June this year, the number of contracts for the purchase and sale of real estate decreased by 16%.

Fig. 1. Index of changes in the number of executed contracts for the purchase and sale of real estate in July 2021.

However, it would not be accurate to compare the current July figures with those of July last year, because lockdown status was introduced in July 2020.

The main reasons for the decline in the number of transactions in the real estate market is the worsening of the epidemiological situation. As a result, potential buyers consider it useless to conclude transactions in the current market conditions and expect uncertainties. At the same time, it should be noted that quarantine restrictions apply throughout the country, which also continues to put pressure on the economy. This was also noted in a parallel study conducted by the Center, in particular, 17 percent of small and medium-sized businesses reported a negative impact of the pandemic on demand for goods / services.

Among other factors that led to a significant decline in demand in the real estate market is a decrease in the number of mortgage loans.

According to the Central Bank of the Republic of Uzbekistan, the number of mortgage loans in July this year decreased by 4.3% compared to the same period in 2020. In June, the decline was 53%.

In general, the number of mortgage loans issued in the first 7 months of 2021 decreased by 19.2% compared to the same period last year.

Fig.2. Mortgage loans provided to the population

Source: Calculations based on data from the Central Bank of Uzbekistan

As for the regions, compared to June this year, there was a decrease in demand in all regions. The highest declines were recorded in Bukhara (27.3%), Namangan (22.1%), Kashkadarya (20.7%), Navoi (18.1%) and Samarkand (17.8%) regions.

Fig.3. Number of mortgage loans issued to the population in the region for January-July 2021

Source: Calculations based on data from the Central Bank of Uzbekistan

At the same time, the number of mortgage loans issued in July 2021 compared to the same period last year significantly decreased in Kashkadarya (60.1%), Bukhara (40.3%), Jizzakh (39.9%), Syrdarya (34.1 %), Surkhandarya (29%) regions.

It is expected to have increased demand in the real estate market by the fall, when the holiday season ends and the active business season begins. Also, the recovery of demand will be facilitated by mass vaccinations.

Khalilullokh Khamidov, Chief Researcher, CERR

tel: (78) 150 02 02 (410)

For all questions regarding the study, please contact the CERR Public Relations Service

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