InfoHub Logo

Almaty is witnessing a surge in the demolition of private homes, with some areas being cleared for essential public projects like schools, hospitals, and roads, while others are slated for multi-story apartment complexes. This heightened interest in urban land is beginning to ripple through the private housing market, leaving homeowners uncertain about their property's future and value.

Resident Concerns and Market Uncertainty

Vera O., a resident of the Turkсіб district, recently discovered that many homes in her neighborhood are slated for demolition to facilitate road expansion. Her primary concern is the potential impact on her own home's value and the difficulty of selling it under such circumstances.

"What should we do now? If we sell, at what price? People are unlikely to risk buying a home within Almaty if it might be demolished soon. Or we'll have to sell it for less than its value before demolition news breaks, as demand for private homes is generally declining," she expressed.

For Vera's large family, the potential loss of their ancestral home is a significant blow. They currently live together, with her sister, two brothers, and their families. A single standard apartment would not accommodate them, and purchasing two separate apartments on the outskirts is financially unfeasible.

Shifting Dynamics in the Private Housing Market

Artem Kalinin, director of an appraisal company, noted that while demand for private homes in Almaty saw a temporary surge after the major earthquakes earlier this year, this activity has since subsided.

Fact: In March of this year, the volume of private home sales in Kazakhstan decreased by 3.4 percent compared to February, with a total of 5,951 transactions recorded. The regions with the fewest sales included Almaty, Atyrau, and Karaganda oblasts.

Kalinin explained that potential buyers are increasingly favoring more affordable one or two-bedroom apartments, as they prefer not to incur large, long-term mortgage debts. This trend has made smaller apartments the most sought-after segment in the current market.

Fact: In March, apartment sales accounted for 79.1 percent of all real estate transactions, with 22,542 deals registered. Almaty recorded the highest number of apartment sales, primarily for one-bedroom units, totaling 8,510 transactions nationwide.

This shift in preference, according to the appraiser, contributes to a noticeable decline in demand for private homes. He observes that the time it takes to sell properties has lengthened, with some homes remaining on the market for up to three years.

How Demolition News Affects Property Prices

Alexander Biketov, a top-tier realtor, explained that the announcement of land expropriation and demolitions in certain city areas causes price fluctuations. Prices in a neighborhood might initially drop, only to rise later.

"Consider the Medeu and Turkсіб districts," Biketov said. "It's known that certain private sector plots might be acquired for infrastructure projects like roads, interchanges, or metro lines. We've encountered situations where potential buyers immediately ask if a house is slated for demolition."

This buyer caution impacts overall demand, often forcing homeowners to offer price reductions to expedite sales and avoid prolonged listing periods. Kalinin added that psychological factors also play a role, as many people are hesitant to engage with the expropriation process due to its complexity and the potential for disputes over compensation amounts.

Consequently, homeowners may opt to sell at a lower price for a quicker transaction. Biketov warned that even if a property isn't directly slated for demolition, proximity to planned construction, such as an interchange or school, can lead to noise and disruption, inevitably lowering the value of nearby private residences.

Experts generally agree on a price correction in affected areas, though the extent varies. Kalinin estimates a modest decrease of around 5 percent in property values in areas where demolitions are announced or rumored. Biketov, however, has observed price drops of up to 10 percent in specific districts.

When Demolitions Can Boost Property Values

Interestingly, demolitions can sometimes lead to property value increases. Dmitry Knyazhin recalled that in 2023, his house and land in the Nauryzbay district were acquired for state needs.

"When mass demolitions of the private sector began, we saw a sharp increase in prices for apartments in nearby buildings and residential complexes, even those just a 10-15 minute walk away. Property values rose by 30 percent at the time. We had to add our own funds to the compensation we received to afford a new place," Knyazhin recounted.

Realtor Alexander Biketov confirmed this phenomenon. He explained that when hundreds of plots are acquired, their owners receive significant compensation. Many prefer to stay in their familiar neighborhoods and seek housing nearby to maintain access to schools and kindergartens for their children. This surge in demand in a limited area can cause prices to skyrocket.

However, Knyazhin believes such a market frenzy might not occur on the same scale this time. "Currently, I think there's an oversupply of housing, with demand being lower. Apartments are becoming more affordable, and developers are offering installment plans. Therefore, property prices might not jump as dramatically after demolitions," he speculated.

Strategies for Selling and Buying Safely

With extended selling periods, potential buyers often hesitate due to uncertainty: "I'll buy now, and tomorrow it might be demolished." Realtors advise homeowners looking to sell quickly to obtain official documentation.

"For those who want to sell their property faster, we recommend submitting an inquiry to the State Architectural and Construction Control Department (SACD)," Biketov advised. "Obtain a response confirming whether your house and plot fall within 'red lines' or are subject to expropriation. With official confirmation that your property will remain, you can sell it more easily. However, only the homeowner can request this information, though a potential buyer can ask the seller to provide such confirmation."

It's important to note that Almaty is currently revising its General Plan. Precisely determining if a house will be in a demolition zone in the future is challenging. The Almaty Department of Urban Planning and Development stated that the timelines for implementing urban planning documentation, including identifying areas for demolition, will be determined after the revisions are completed, estimated around May 2026.

Experts emphasize that with revisions nearing completion, homeowners can ascertain their property's fate. Biketov reminded Almaty residents that they have experienced similar situations before. Past events suggest that while initial market activity might surge, it eventually stabilizes, and prices return to their previous levels.

Despite this, an increasing number of people are hesitant to invest in private homes, while others still desire land ownership. The constant news of demolitions, however, fuels the perception that any area with private construction in Almaty is vulnerable to eventual demolition. This uncertainty leaves many Kazakhstani citizens hesitant about buying or building homes within the city, especially since crucial information, like demolition plans, is often revealed unexpectedly. If Almaty's General Plan were more accessible, such ambiguity could be significantly reduced.

Бұл туралы Infohub.kz ақпарат агенттігі хабарлайды.