Business: Real estate prices in Samarkand rise five- and six-fold in the last three years

Ferghana.Ru news agency, Diyor Sogdiyev, 17.06.2006

People started leaving Uzbekistan for the lands of their ancestors as soon as the Soviet Union disintegrated.Apartments and whole houses were put up for sale en masse. The process was thoroughly unprofessional. Unacquainted with free-market laws and rules, residents of Samarkand organized an impromptu real estate market. Selling their flats and houses, they had only vague ideas on how much they were really worth. Some failed and sold whatever they had for a song, others fared better. Here are a few figures. A three-room apartment with furniture in the prestigious area near the railroad station was sold for only $1,200 in the early 1990's. An empty two-room flat in Sogdiana (a residential area that was not exactly popular then) went for $1,900.The Samarkand market began winding down some in the late 1990's. Prices plummeted. An apartment in the settlement of chemists (better known as Super - a derivative from the superphosphate factory nearby) could be had for $100 only, while a three-room house in the center of Samarkand (the so called Red Square or Mustakillik Street, former Leninskaya Street) for $2,500. One hundred square meters of land here (just like in the environs of the Agricultural College) costs as much as $3,000 nowadays.Prices stabilized in the last several years of the 20th century and first ones of the 21st. An average two-room apartment cost $1,000-1,100 in 2002. Some (the upper floor) apartments were offered even for $750, and three-room ones for $1,500-1,800. Prices literally soared a year later.Specialists of a local real estate agency say that 2003 was a year of mushrooming sales. In fact, the first real estate agency opened in Samarkand precisely then. There were three of them two years later.Experts attribute this activization to several reasons. First, state construction of tenements stopped in Samarkand for good. Two many-storied buildings near the University Boulevard were the last to be built. Apartments there were expensive indeed, and not everyone could afford one. Several dwelling houses in Sogdiana (in the vicinity of SamKochAvto car factory) were the last where families waiting for apartments from the state received several flats.Second, the Uzbeks working abroad began sending more or less substantial sums back to their families in Samarkand. Unable to invest the money elsewhere, the locals started buying apartments and prices immediately went up. Buyers became interested in expensive apartments and dwellings. Private construction began.Reconstruction of Samarkand is the third reason. Known as the Pearl of the East, the city is being constantly rebuilt. Whoever visited it only four years ago is unlikely to recognize Samarkand now. The locals believe that their city would have been better off without it because builders take apart everything they consider unnecessary including small cafes, old houses, small stores, and even department stores... Restaurant Yubileiny, Central Department Store off Registan, and Chukur-Bazaar (the largest flea market in the city across the street from Siab Bazaar) are history now. All these changes upset the population. They are particularly sorry that old trees are felled in Central Park (formerly Gorky Park) and along the University Boulevard (former Abramov Boulevard). But we are not going to discuss it here. One has to admit that the city is even more beautiful now and that its famous sights like the Registan Square and Gur-Emir and Shakhi-Zinda mausoleums could be seen from every direction nowadays.A great deal of dwelling houses were razed to the ground, and that had its effect on prices as well. What the locals khokimijats [administrations] offer residents of the buildings to be taken down is rarely satisfactory, and the people take the matter of finding a new dwelling into their own hands. They earnestly believe that the authorities by way of a recompense will came up with as much money as they will demand. If the authorities ever do or not is hard to say, but this is another factor that sends the prices soaring.Unlike in the past, the demand and supply in the real estate market grow proportionally now. According to one of the local real estate agencies, a one-room apartment costs $4,000-7,000, two-room $6,000-10,000, three-room $8,000-15,000 (or even as much as $35,000 in the vicinity of the University Boulevard), and four-room $10,000-20,000 nowadays. Private houses with plot of land cost much more than that.A great deal of factors are taken into account when the price is set. Square meters, age of the building, and so on. What with the numerous problems in the housing and communal sphere, even the availability of gas, central heating, and running water (different from one residential area to another) has its effect on the price. And the floor, of course. Cold water in Sogdiana and Sattepo, for example, is only available twice a day (mornings and evenings) for brief periods, and hot water only in winter. The so called Old City and Sattepo residential areas regularly encounter problems with gas in winter. The state of affairs with electric power is more or less uniform throughout all of Samarkand. Power outages are frequent in the elite areas and slums alike.The cheapest flats are usually located on the upper floor - roofs are leaking, and lifts are permanently broken. An apartment on lower floors may cost $15,000-20,000 but whoever is selling one on upper floors will be lucky to get even a third of this sum.Real estate agencies pin their hopes on the Russian-Uzbek rapprochement. They hope that Samarkand factories will start running again and that it will bring in new employees and have a positive effect on the real estate market.

Samarkand as a sight for foreign tourists is another hope. Buildings are frequently bought here for conversion into restaurants, cafes, hotels - everything tourist infrastructure includes. Even businessmen from Tashkent buy real estate in Samarkand, attracted by the rumors that the city will be granted the status of a "world tourist attraction". That is apparently why real estate in Samarkand is sometimes more expensive than in Tashkent.