Rumor has it that real estate prices are going down in Yerevan.
If so, it will be truly sensational due to the fact that we have been seeing skyrocket prices for homes during the past two to three years. In fact, there were some people claiming that prices are going down at an extremely rapid pace, while others were simply saying that prices are going down just a little. “168 Hours” decided to get information from the brokers.
The “Yerkir” real estate agency told us that based on their data, there is no such tendency.
“Perhaps house prices are going down based on the devaluation of the dollar. But they remain the same prices in dollars,” said the representative of “Yerkir”.
The “Realty Group” real estate agency assured us that there is no such thing. On the contrary, real estate prices are going up. The representative of the agency said that the reason for that was the devaluation of the dollar.
“As you know, the prices are in dollars and not drams. People change the price of the dram with the devaluation of the dollar. But when we compare the new prices of the people who have worked with us when selling their homes with the previous prices, we see that they have grown in dollars too.”
For example, if the homeowner sets the price for his home at 20,000 dollars, which was 9,000,000 AMD a month ago, he will get 8,300,000 AMD in exchange for his 20,000 dollars. But the homeowner doesn’t fix the price at 8.3 million, but rather 8.5, or he doesn’t lower the price at all.
This shows us that the evaluation of the dram in Armenia doesn’t really mean anything. People see how the dollar value goes down, but they count in dollars when it comes time to make calculations. The circulation of millions of drams only exists in the mortgage paper contracts. In reality, the buyer and the seller make the transaction with the dollar going down, and not the “increasing” but worthless dram.
Getting back to real estate prices, it is worth mentioning that it is quite possible that prices will go down, although usually there is no tendency. This is simply illogical, just like it’s illogical to find the reasons why they tripled during the past 2-3 years.
The next broker I talked to was a professional and he said that there is an insignificant decline in real estate prices, but only the people living in the outskirts of Yerevan see that decline, while prices for homes in the heart of the city keep rising. He said that the reason for this was the demand.
“The demand for homes in the outskirts of Yerevan has gone down a little and people are more interested in buying homes in the heart of Yerevan or Komitas street.”
If real estate prices actually do go down, then we can say that rumors like these can be just one of the reasons. As all Armenians know, rumor spreads fast in Armenia and that may make real estate owners panic and force them to sell their homes as soon as possible. I don’t really know who will benefit from that. One thing is for sure: real estate agencies don’t want prices to go down and they also don’t want to hear the spread of these rumors. That’s why they keep denying them.
No matter how surprising this may sound, but the authorities also don’t want to see the rise in real estate prices and the spread of the rumors because this will lead to political instability and the change in the moods of potential buyers. Real estate prices always go down during the pre-election period, but when the process starts this soon, they may go extremely down and be looked at as a sign of instability in internal politics.