By Atom Markarian
Political tensions and uncertainty engendered by the recent national elections have somewhat slowed down the ongoing steady growth in real estate prices in Armenia, the government said on Thursday. “The number of real estate deals in the country has fallen, but the price of apartments has not,” the head of the State Committee for the Real Estate Cadastre, Manuk Vartanian, told reporters.
Vartanian said the monthly rise in housing prices fell from an average of 3 percent to “between 1.3 and 1.5 percent” during the tense presidential election held in two rounds in February and March. He said the growth rate has since remained unchanged due to the May 25 parliamentary elections and the preceding campaign.
Elections, routinely marred by allegations of vote rigging, are the main source of domestic political instability in Armenia. Government data show that the negative impact of the 2003 polls on overall economic activity has been negligible, with the Armenian economy continuing to expand at a double-digit rate in the first quarter of the year.
The average price of houses and apartments in Yerevan and other regions of the country jumped by roughly 50 percent in the course of 2002, in what the Armenian government views as proof of rising living standards. The surge has been particularly high in the center of Yerevan, the country’s most expensive residential area.
Vartanian said his agency attributes the trend to strong demand in housing which is not matched by corresponding supply. He said the deficit is the main factor in the construction boom in central Yerevan where new upmarket apartment buildings have sprung up in recent years. A two-bedroom apartment there costs between $80,000 and $100,000. The price is beyond the purse of the vast majority of Armenians.