Tashkent, Uzbekistan (UzDaily.com) -- Real estate market activity at the end of the second quarter of this year has slightly slowed compared to the same period last year. Unlike previous years, there is no characteristic increase in the number of transactions, and the volume has remained at the level of the first quarter. This is outlined in the Central Bank’s report, "Real Estate Market Analysis."

In April-June, 80.1 thousand contracts were signed, almost unchanged from the 80.2 thousand transactions in the first quarter. A significant decrease in activity is observed in Tashkent (-8%), Bukhara (-10%), Tashkent region (-12%), and Navoi (-26%) regions—areas that previously had higher activity due to rising prices.

The slowdown in activity is likely related to the stabilization of the real estate market, notes the regulator.

Housing supply continues to grow. Previously acquired residential properties are being listed on the secondary market or rented out amid slowing price increases. The number of secondary housing listings has increased by 12.7% since the beginning of the year, while rental offers have risen by 18.4%.

At the same time, demand for housing is also leveling off due to normalizing population incomes, a slowdown in mortgage lending, declining inflation, and relative exchange rate stability. The reduction in speculative demand is contributing to market normalization and subsequent correction.

It is expected that government programs to increase housing affordability, including targeted mortgage loans, as well as the Central Bank’s macroprudential measures, will help balance the real estate market.

In the second quarter, there was a noticeable slowdown in the growth rate of residential real estate prices. Monthly price growth rates were lower than in the same period last year.

For the first six months of the current year, prices for secondary housing increased by 4.5% in sum terms (compared to 11.8% in January-June 2023), and for primary housing by 7.2% (compared to 10.9% in January-June 2023).

Due to the lingering effect of high price growth observed in the second half of 2023, the year-on-year growth of secondary housing prices as of June was 26.3% in sum terms (14.7% in dollar terms).

On the primary market, price growth remains relatively stable: year-on-year, primary housing prices increased by 35% in sum terms and 22.5% in dollar terms.

Rental market activity remains moderate, and prices continue to decline. In Tashkent, the decrease in rental costs is more noticeable compared to other regions.

The annual increase in the rental price index in June across the republic was 12.3% (2.1% in dollar terms). In Tashkent, the index decreased by 1.2% compared to last year (the dollar index decreased by 10.3%).

The gap between the growth rates of purchase prices and rental prices continues to widen. In the future, this may exert downward pressure on purchase prices due to a shift in demand towards long-term rentals, which could also contribute to balancing real estate price growth.

The second quarter also saw a correction in land prices. In Tashkent, the cost of one hundred square meters of land in June was 342 million sums, an increase of 25.7% over the year.