From January, the cost of new housing may increase by at least $100 per square meter.

Wednesday, December 11, 2024, 12:22 Kyrgyz citizens have taken to social media to express concern over a potential rise in real estate prices, as forecasts suggest that the cost of new housing could increase by at least $100 per square meter starting in January. “This is largely a psychological factor,” economist Iskender Sharsheev told Vesti.kg. “It can lead to what appears to be a spontaneous agreement among construction companies. Consider what happened during the COVID-19 pandemic: when vast amounts of dollars were printed, suppliers cited blackouts and other increased costs. Buyers had no choice but to pay. Now, a similar pattern seems to be emerging. Influential parties are claiming that the market will become more expensive, creating an ‘information noise.’ They point to hardships and rising expenses, and in response, the market adjusts. Ultimately, people just want to earn more.” Sharsheev also noted that the upcoming New Year holidays contribute to the issue. “Every year before the holidays, businesses raise their prices because they know consumers will stock up. This practice fuels rampant inflation. Once the holidays end, prices don’t drop; instead, businesses find reasons to keep them elevated. As a result, the market enters a cycle of perpetually high prices. The expansion of the money supply, especially when held in reserve, combined with basic human behavior, remains the primary driver of current price increases.” In an attempt to address economic concerns, the Ministry of Economy recently proposed a tax on construction companies. However, members of parliament opposed the idea, arguing that it would push housing prices even higher. President Sadyr Japarov later expressed a negative view of these proposed taxes as well. Additionally, the Kyrgyz government plans to demolish apartment buildings that have reached the end of their service life—approximately 50 to 70 years. This initiative was announced by the head of the State Construction Committee, Nurdan Oruntayev. Source: here