Residential property prices are expected to surge by 15 to 20 per cent next summer, according to Kamal Awamleh, president of the Housing Investors Society (HIS).
Awamleh explained that developers will incur higher construction costs next year due to rising fuel prices and an anticipated increase in the prices of construction material, which will push up the value of apartments.
He told The Jordan Times over the phone Sunday that a slowdown in the real estate market has prompted investors to reduce their profit margins to encourage potential buyers.
“It is very hard to raise property prices at this point of time as there is stagnation in demand due to difficult economic conditions in the Kingdom,” Awamleh said, pointing out that 85 per cent of residential property buyers are Jordanians.
Noting that housing investors agreed at a recent meeting to keep apartment prices stable for the time being “to enable Jordanians to buy homes at reasonable price”, the HIS president said he expected the real estate market to bounce back in the coming weeks.
Asked if the current political situation in the country, coupled with statements by officials about the state’s fiscal and monetary hardships, have pushed people to buy property, Awamleh noted that there is a trend towards purchasing real estate, but demand on land is higher than apartments.
He added that industry investors have come up with suggestions that could bring prices down, such as expanding roads and water networks into Amman’s outlying areas, as there is intense competition among developers for increasingly scarce plots of land in the capital suitable for residential projects.
Awamleh said land prices went up sharply over the past two years because there are limited areas of lands suitable for housing units in the capital.
Another proposal by investors to keep property prices affordable, according to Awamleh, is for regulatory authorities to allow developers to construct seven- to 10-storey housing buildings to cut the cost of land, which constitutes around 50 per cent of the overall value of housing projects.
Currently, residential buildings in Amman cannot be higher than five storeys.
