Azerbaijan.US
Buying an apartment in Baku is becoming increasingly difficult with each passing year. Rapid price growth, administrative restrictions in the construction sector, and weakening competition have pushed housing affordability further out of reach for many families, forcing thousands to remain in the rental market.
While some official figures estimate that housing prices rose by around 45–47 percent between 2020 and 2025, independent assessments suggest the real increase is significantly higher. According to real estate experts, the discrepancy stems from differing methodologies and data sources used to calculate market dynamics.
Speaking to local media, real estate analyst Elnur Azadov noted that long-term trends paint a more concerning picture. Based on market evaluations, prices in Baku’s primary housing market have increased by more than 70 percent since 2000, with the sharpest growth recorded in the capital and the Absheron Peninsula. In contrast, regional markets have seen more moderate increases, typically ranging between 25 and 30 percent.
Data referenced by the Mortgage Fund indicates even steeper growth, with some estimates exceeding 75 percent. Compared to late 2020, prices on Baku’s primary market have risen by roughly 70 percent, while older housing stock has increased by around 65 percent. Overall, average growth across Baku and Absheron stands at 55–60 percent. In the regions, limited data suggests price growth varies widely, from 30 percent to as high as 50–55 percent.
Certain locations have experienced especially dramatic spikes. Azadov points to the Sea Breeze area as the most striking example, where property prices have surged by 100-150 percent over the past two years. Land values there have risen particularly sharply, while residential units are now selling for nearly double their previous prices. Significant increases have also been recorded in Baku’s White City development, where prices over the past three years have climbed by an estimated 75–80 percent, and in some cases up to 100 percent.
One of the key drivers behind the sustained price growth, experts argue, is tighter administrative control over construction. Since 2018, when urban planning and construction oversight was centralized under the Architecture Committee, the number of permits issued to developers has dropped sharply. This reduction in supply has allowed construction companies to raise prices amid limited new projects.
Additional pressure came after 2020, when large-scale reconstruction began in Azerbaijan’s liberated territories. The surge in demand for construction materials led to higher prices for steel, reinforcement bars, and other inputs, increasing overall building costs and, ultimately, sale prices.
Declining competition has further distorted the market. With fewer developers actively building new projects, companies have been able to sell apartments at prices 15–20 percent above prevailing market levels. According to experts, unless mass construction permits are restored and new projects are launched, price growth is unlikely to slow over the next one to two years.
Analysts warn that only a more competitive environment – supported by increased supply and regulatory balance – can stabilize the housing market and make homeownership in Baku more attainable again.
