First of all the land owner or leaser applies to the municipality and presents the ownership certificate or leasing contract, as well as the outline of the building. Based on this information the municipality gives an architectural assignment. Based on this assignment and the outlines the draft of the house is prepared and then is sent to expertise. There are special expertise organizations in Armenia. Afterwards the draft project must be approved by the municipality, based on which it gives permission for construction. There should also be a construction company, which has a license from the Ministry of Urban Development of RA. Construction should start in a year after the license is attained. Before the construction begins a timeline is given pinpointing the beginning and end of the construction. If this is violated, for example in Moscow, they apply fines. However in Armenia no one cares about this and the result is that we can see incomplete construction all over the country and it takes years for it to finish. After the completion of construction a completion act is prepared, which is sent to the municipality. Based on this the cadastre bureau gives the property certificate.
First the citizen should pay for the project. According to constructor Yuri Mkrtchyan if any firm provides all the necessary documentation (architecture, construction, heating, air conditioning, electric chords, etc) for the project, then the project will cost $10-12 per square meter (including taxes). “However, the project can become expensive due to some complications. For example, sometimes customers want winter pools or a garden. All this depends on market relations”, mentions Mkrtchyan.
The price of each square meter of an average villa would be not less than $500-600. But other lavish and fancy things are extra expenditures. For example, a Jacuzzi costs $6-7 thousand. Also the inner design of the house is more expensive than the outer one.
According to Mkrtchyan the price of construction materials of Armenia has increased by 2-2.5 times over the last two years. For example, 4 years ago the “tuff” of Artik, which is the best, cost 50-100 AMD, now it’s 200-250 AMD depending on the size of bricks. A few years ago the price of a meter of wood board cost $80-100, now it ranges from $180-200. The factory price of cement has also doubled. The price of one ton has increased by 2500-3000 AMD.
The salaries for workers have increased too. Today there is a high demand for good constructors. “The good specialists are either old or have migrated from Armenia and there are not too many young specialists,” says Mkrtchyan.
Today there is no high demand for villas in Yerevan because citizens prefer to buy an apartment downtown. A high demand of building villas is in Tsakhkadzor, Arinj, Ohanavan, Ptghni, etc. And in Yerevan the main reason of building houses is to give those houses for rent to foreigners.
Mkrtchyan mentioned that at present, mostly rich people build villas. Even medium businessmen cannot afford this. First of all, land is very expensive – $100-200 per square meter (of course not in the center of Yerevan). And at least 800-1000 sq/m area is needed for the construction of a normal villa. Based on this information we may assume that in order to build a typical villa we need $200-250 thousand dollars.
At present, the people who build villas have found a way to avoid paying taxes for construction. When presenting the project of the house it’s necessary to show the stamp of the construction organization. Very often, contractors don’t present this stamp and the construction is considered illegal, however later it is “legalized” by other methods.
Different consumers have different tastes. Recently a Russian-Armenian bought land in Masis and wished to construct a Japanese villa with a Japanese yard, roof and doors. Other owners wish to have a villa covered in glass. Nevertheless, Armenians still aren’t interested in building European wood villas.