Cost of housing rental in multi-storey buildings in Tashkent announced

Experts of the Institute for Forecasting and Macroeconomic Research (IFMR) analyzed rental prices in high-rise buildings in the districts of the city of Tashkent.

Based on the results of the analysis, it became known that the average cost of renting in multi-storey buildings in Tashkent is $339. In the housing rental market, the lowest price was recorded in Sergeli and Almazar districts, and the highest – in Mirabad and Yakkasaray districts.

The profitability of the rental business (rental yield – income received per year from renting a house) is 10% for Tashkent. For comparison, this figure is 6% in Romania, 5% in Poland, 3% in Germany and 2% in Turkey.

At present, the income from renting real estate in Tashkent is three times higher than the average income of a bank foreign currency deposit (3.4%). This indicates that today it is more profitable to spend savings on real estate and sell it in Tashkent than to store it as a pledge in foreign currency.

The price/rent ratio for Tashkent is 10 years. This figure is 52 years in Turkey, 34 years in Germany, 18 years in Poland and 17 years in Romania. So, owning a house in Tashkent is cheaper than renting. This naturally increases people’s desire to own their own home rather than live in a rented one.

The average price of an apartment in the center of Tashkent is 50 times higher than the ratio of GDP per capita. This figure is 158 times in Ukraine, 87 times in Russia, 66 times in the UK, 20 times in Switzerland, 17 times in Germany and 5 times in Luxembourg. It shows whether people’s purchasing power is low or high in general.

Experts note that the apartment rental market in Tashkent is at the initial stage of formation.

Taking into account the acceleration of the urbanization process, for the development of the rental market, it is recommended:

-  further strengthening of the legal framework for protecting the interests and rights of tenants; 
-  control abrupt changes in rental prices, for example, establish by law that the rental price cannot be increased by more than 10% of the average price in the city without explaining the reasons or relevant prerequisites;
-  widespread introduction of information technologies that directly connect the owner of the house and the potential tenant in order to prevent the problem of information asymmetry in the market.