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  REAL ESTATE MARKET IN BEIRUT LEBANON

 

The Lebanese real estate market has showed to be the most flexible and sustainable market in the region despite difficult political situation. Even with the political stalemate that carried on over the first half of 2011, construction activities continued to be strong in Beirut city and suburbs.

In an overview of Lebanon’s real estate market performance, a report indicates that the construction market and property prices have sustained on an exponential uptrend, against all detrimental impacts derived from chronic political uproars, and economic woes. As regional peers suffered, Lebanon's construction sector has accredited its resilience to the firm demand by Arab nationals, Lebanese expatriates, and locals in spite of the surge in real estate prices. The general drivers include reduced interest rates, high liquidity in the banking sector, availability of long term mortgages, favorable demographics, low taxes, alternative sources of financing, and encouraging laws for real estate foreign ownership.

However, real estate demand has eased as shown by the drop in total value and number of transactions completed in the sector during the six months of the year. In fact, figures released by the Directorate of Real Estate show a slowdown in real estate activity in the country during the first half of 2011, a continuation of the trend witnessed in the fourth quarter of 2010 as investments started to drop. Indeed, as a Bank Audi report shows, the number of property sales transactions has declined by 18.6% in the first half of 2011 relative to the same period of 2010 to reach 37,386 transactions. The drop in demand for property in Lebanon during the first half of this year was coupled with an almost similar decline in the value of property sales during the same period, which shows that prices of property in Lebanon remained stable. Indeed, the value of property sales has reached $3,850 million in the first half of 2011, down by 18.3% relative to the corresponding period of 2010. As such, the average value per property sale in the first half of 2011 has gone up by a minor 0.4% relative to the same period of 2010 (to reach $103 thousand).







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