Expert says Armenia's real estate market remains stable, denies collapse claims

Armenia’s real estate market has withstood repeated predictions of an imminent collapse, continuing to operate steadily with moderate price growth and sustained demand, according to Andranik Harutyunov, founder and chief executive of Silver Ria real estate agency.

In an interview to Panorama.am on Wednesday, Harutyunov said public debate has often been distorted by oversimplified statistics and alarmist forecasts that have failed to materialize.

“Trying to describe the market in one word, saying prices have either gone up or down, is not a professional approach,” Harutyunov said. “Real estate is multi-layered: primary and secondary markets, rentals, different districts and different classes of buildings. When all of this is reduced to a single average figure, the real picture disappears.”

Official data from Armenia’s Central Bank and the Cadaster Committee are frequently cited to support claims of sharp price fluctuations. However, Harutyunov noted that even within the same administrative district, prices can differ significantly.

“In one new development the average price may be 500,000 drams per square meter, while just a few streets away it could reach 750,000,” he said. “If more high-end properties are sold in a given quarter, statistics automatically show growth. That doesn’t mean the entire market has become more expensive.”

Over the past two years, analysts have repeatedly warned that Armenia’s property market was heading for a “burst” due to slowing sales. Harutyunov states transaction data does not support those claims.

“They said there were no sales, that the market was at a dead end and a crash was coming,” he said. “But if you look at transaction volumes, that simply isn’t true. The market is living its normal life both in the secondary and primary segments.”

Following legislative changes that limited income tax refund incentives for mortgages, developers adapted rather than exited the market, Harutyunov said. Many now offer long-term instalment plans lasting five, seven or even ten years, often without bank involvement.

“Developers transformed their sales processes,” he said. “Deferred payment options became widespread. Sales continue, there is no catastrophic situation, and prices have not been sharply affected.”

According to Harutyunov, property prices in Armenia have not declined and continue to grow at an average annual rate of 5-10%.

“This is a natural capitalization process, also influenced by inflation,” he said. “As money loses value, real estate becomes more expensive.”

One of the market’s most persistent problems, he added, is insufficient awareness among potential buyers.

“There are families with three or four working members who say they can’t qualify for a mortgage,” Harutyunov said. “People often don’t assess their real financial capacity or study the available programs.”

Despite years of implementation, some buyers are only now learning about income tax refund schemes linked to mortgages.

“People come to us and say, ‘If only we had known earlier, we would have bought property,’” he said.

Harutyunov also noted that mortgage approvals have become significantly faster and simpler than a decade ago, largely due to salary transparency and income declaration systems.

“Today banks can immediately see a client’s financial situation,” he said. “Income declaration has simplified mortgage approvals and made the market more accessible.”

Demand for newly built housing is expected to remain strong in the long term, driven by Armenia’s ageing housing stock and rising expectations among buyers.

“Most residential buildings are 50 to 60 years old and have not been properly maintained,” Harutyunov said. “People are moving toward new developments with parking, infrastructure and conditions suited to a 21st-century city resident.”

In Armenia’s regions, however, construction faces significant challenges due to weak infrastructure.

“If there is no sewage, water supply or road access, developers have to create all of that themselves,” he said. “This can account for 30-40% of total project costs, amounting to millions of dollars.”

Looking ahead to 2026, Harutyunov said he does not expect dramatic changes unless major geopolitical disruptions occur.

“If there are no major geopolitical shocks, the market will continue its normal life,” he said. “There is demand, developers continue to build and buyers continue to buy.”