Real Estate Investment in Baku, Azerbaijan

In recent years, there has been a significant increase in the number of foreigners investing in the real estate market of Azerbaijan. Foreign investors are actively purchasing luxury apartments, villas and commercial properties, primarily in the capital city, Baku. Clearly, numerous factors are attracting these investments to the country. This article will outline those factors, provide useful information and discuss the legal aspects of both commercial and residential real estate investments in Azerbaijan.

We hope this blog post will be informative for foreigners planning to invest in either commercial or residential real estate in Azerbaijan. Furthermore, if you require real estate investment consulting or legal services regarding the process of real estate investment in Azerbaijan, do not hesitate to turn to PROCO for assistance.

Why do foreign investors invest in Azerbaijan Real Estate Market?

As mentioned earlier, various factors attract foreign investors to both commercial and residential real estate investments in Azerbaijan. Based on our experience in the country’s property market, we will highlight some of these key factors:

  • Firstly, compared to other countries, real estate prices in Azerbaijan are less expensive, especially for premium real estate. Yet, these prices are steadily increasing. For numerous large-scale real estate projects, we have observed an average annual price increase of 15 to 17 percent in recent years, which attracts real estate investors. Additionally, the rental values of real estate are consistently rising, particularly for premium real estate projects.
  • Secondly, a number of well-known, large-scale premium real estate projects are currently being implemented in our country, especially in the city of Baku. This is another reason that attracts foreign real estate investors to Azerbaijan.
  • Thirdly, every year, many foreigners from various countries relocate due to economic and social reasons. Additionally, some choose to move to Azerbaijan, invest in real estate (mostly residential) and obtain residence permits in Azerbaijan to live here. 

What types of Real Estate to invest in Azerbaijan?

Based on our experience, we’ve observed a high interest from foreigners in both residential and non-residential real estate in Azerbaijan. Foreign investors predominantly focus on premium real estate. Particularly, there is a high demand for residential properties, with luxury apartments and villas being most preferred by foreign investors.

But what kind of real estate should you invest in Azerbaijan? The answer largely depends on your investment goals and budget, considering the current market realities. For this reason, we recommend getting an initial consultation tailored to your personal investment budget and goals. Receiving professional real estate consultation can significantly help in making the right investment decisions and achieving better returns. Proper planning can yield about 20 percent annual returns on many real estate projects, and potentially even more on some. This represents a substantial difference compared to the real estate markets in many other countries.

Real Estate Investment in Baku Azerbaijan

Rights and restrictions for foreign Real Estate investors in Azerbaijan

In Azerbaijan, foreigners have the same rights as local citizens to purchase residential or commercial real estate. They can buy apartments, villas and commercial properties just as locals do. This rule also applies to companies established by foreigners. However, there are legal restrictions for foreign individuals on purchasing land plots, as dictated by legislation. Nonetheless, local companies established by foreigners are still entitled to purchase land plots in Azerbaijan, as they are considered residents of the country.

How to invest in Real Estate in Azerbaijan?

For foreign investors, the real estate investment process in Azerbaijan is quite straightforward. Based on our experience, we recommend to foreign investors to follow these steps in the investment process:

  1. Ensure to have a proper investment plan: Proper planning is the key to success in real estate investing, just as it is in any business. 
  2. Determine the type of real estate to invest in and the investment method: Ensure you make the most optimal decision based on your investment goals and budget.
  3. Ensure all legal aspects are compliant: It is very important to identify any legal risks in time. Therefore, do not hesitate to contact real estate lawyers if necessary.
  4. You can invest now.

PROCO services for real estate investment in Azerbaijan

Finally, if you require professional real estate investment consulting or legal assistance with your real estate investments in Azerbaijan, feel free to contact PROCO. Our team of real estate lawyers and investment consultants is ready to provide you with the necessary consulting and legal services related to real estate investments in our country. We would be delighted to assist you and share our expertise in the field of real estate investment.