Property sales down 10 pct in 2015
02 February 2016
BEIRUT: Lebanon’s real-estate and construction sectors continued to reel under the severe economic slowdown and lack of investor confidence as the sales of apartments fell by more than 10 percent in 2015.
According to a report by Bank Audi, the total number of property-sales transactions registered 63,386 in 2015, down by 10.5 percent relative to the 70,795 transactions registered in the previous year.
“Subsequently, the value of property transactions fell from $8.956 billion in 2014 to $8.006 billion in 2015, a yearly contraction of 10.6 percent. Likewise, property taxes fell by 13.6 percent over the year, moving from $502 million to $433 million accordingly,” the report said.
Despite the contraction in the property market and construction activity, realty prices did not witness noticeable declines, but were limited to few discounts in a buyer’s market.
The report said that the real-estate and construction sectors were under pressure in 2015, witnessing net contractions in major aggregates – namely property transactions, deliveries of cement and construction permits – within the context of the wait-and-see attitude characterizing investment in the country. Consequently, there is a delay in major investment decisions in an environment of political uncertainty.
Figures released by the Central Bank of Lebanon show that cement deliveries, a coincident indicator of construction activity, decreased by a yearly 9.4 percent in the first 11 months of 2015.
Cement deliveries actually reached circa 4,595,000 tons in the year to November 2015, down from 5,072,000 tons in the corresponding period of 2014.
“As an indication of the slowdown in future construction projects in the country, construction permits were down in 2015. Construction permits delivered by the Orders of Engineers of Beirut and Tripoli covered an area of 12,339,176 square meters in full-year 2015, a net contraction of 8.9 percent from the 13,545,707 square meters registered in 2014,” the report said.
“The analysis of real-estate and construction activity by region suggests a continuously declining share for the capital. As a percentage of the total value of property sales, Beirut saw its share shrinking from 27.3 percent in 2014 to 24.9 percent in 2015. Likewise, the share of the south declined from 7.0 percent to 6.2 percent.”
It added that all other regions witnessed either stability or expansion in their shares. In particular, Metn saw its share rise from 17.7 percent to 19.6 percent, while Kesrouan’s share increased from 11.5 percent to 12.6 percent.
As a percentage of total construction permits, Beirut saw its share shrinking from 6.9 percent in 2014 to 5.4 percent in 2015 and the share of the area covered by the Order of Engineers in Tripoli declined from 17.6 percent to 16.6 percent.
Mount Lebanon, which has consistently had the lion’s share saw its portion rise from 46.2 percent in 2014 to 47.9 percent in 2015. The shares of south Lebanon, Nabatieh and Bekaa stabilized at 12.3 percent, 8.3 percent and 8.2 percent respectively.© Copyright The Daily Star 2016.