BEIRUT: Demand for real estate stagnated in the fourth quarter of 2018 amid political uncertainties and slow economic activity, as Lebanese shelved plans to acquire properties.
The Index posted a monthly average of 51.2 points in the fourth quarter of 2018, nearly unchanged from 51.4 points in the third quarter of 2018.
The results, compounded by Byblos Bank, were due to "the absence of concrete initiatives to stimulate demand in the real estate market," Chief Economist Nassib Ghobril said.
As such, the Index’s average monthly score in the fourth quarter of 2018 came 61% lower than the peak of 131 points registered in the second quarter of 2010, and remained 53.4% below the annual peak of 109.8 points posted in 2010.
"The government's announcement in April that it intends to earmark LBP 1,000 billion on subsidized housing loans, the Parliament's vote in September to allocate LBP 100 billion for subsidized mortgages, as well as the multiple draft laws that political parties submitted to Parliament to restore subsidies, raised the expectations of citizens that subsidized mortgages will resume on a large scale," he said.
This is turn led prospective buyers to delay their purchasing decisions in the hope of a resumption of subsidies.
To stimulate demand, Ghobril outlines a number of possible initiatives.
"First, the government should reduce by 50% the registration fee on all purchased residential units for two years, not just on apartments whose price is $250,000 or less, as is currently the case," he said, adding that developing the rent-to-own, or leasing, option for low-income persons would also help kickstart the real estate sector.
The Byblos Bank Real Estate Demand Index is a measure of local demand for residential units and houses in Lebanon. The Index is compiled, implemented and analyzed in line with international best practices and according to criteria from leading indices worldwide.
An-Nahar is not responsible for the comments that users post below. We kindly ask you to keep this space a clean and respectful forum for discussion.