Anxious Lebanese turn to property amid banking crisis

An anti-government demonstrator holds a Lebanese flag in Beirut. (Reuters/File)
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Updated 24 June 2020

Anxious Lebanese turn to property amid banking crisis

  • New class of investor emerges as people in the country seek to protect savings

BEIRUT: The Lebanese real estate sector has witnessed a spike in activity in the past three months despite an economic crisis that has seen the exchange rate of the dollar reach 6,000 lira, four times the official price.

Raja Makarem, a property expert and director of Ramco Real Estate, said that sales over the past three months amounts to over $2 billion. He told Arab News that the real estate rush “will continue as long as the Lebanese banks agree to give bank checks to their depositors.”

The decline of the real estate sector was one of the major signs of the economic crisis that began in 2012.

The crisis peaked after the end of subsidized housing loans and the decline of foreign investment in the Lebanese real estate market.

With Lebanon entering the stage of financial collapse in the second half of last year, real estate sector indicators recorded dire results for property value and sales numbers on top of a notable decline in new building licenses.

Property sales fell by up to 70 percent and the prices of apartments, especially larger ones, fell in value by 25 percent on average.

In light of banking restrictions on personal savings pushed through last November, and rumors of further measures, many Lebanese have used property as a vehicle to retain personal savings.

Jamal Shamas, a property expert, said: “During the last three months, depositors, especially those with large amounts, have been rushing to buy apartments in Solidere, in the heart of Beirut, and apartments on the Beirut waterfront, as these areas maintain their value due to their unique locations.”

He added: “I now receive 20 calls per day to procure apartments as an accredited expert for real estate appraisal.

“This phenomenon reached its climax when the banks announced that the depositors can withdraw small amounts from their dollar-based savings in Lebanese pounds, with a generous fixed exchange rate, so depositors rushed to real estate to save their deposits.”

“These depositors are not all Lebanese; there are Syrians, Iraqis, and Gulf nationals who have accounts in Lebanese banks. Most of the Lebanese are expatriates in Africa or those who work in Arab countries.”

Raja Makarem agreed, adding: “This reality created a great demand for vacant apartments, which experienced flexibility in prices. The buyer is trying to take advantage of the decline in real estate prices and the seller, which is usually a real estate developer, accepts a small loss in order to pay off a loan to the bank.”

“Over the past three months, many developers have sold a stock of apartments that they have been unable to sell for years.

“This rush on real estate has revived the strained market again, with prices increasing by 20 to 30 percent compared with six or seven months ago, and returning to their 2010 level.”

Jamal Shamas said there is no property remaining in the Solidere area to sell.

Iran shutters newspaper after expert questions coronavirus numbers

Updated 10 August 2020

Iran shutters newspaper after expert questions coronavirus numbers

  • Jahane Sanat began publishing in 2004 and was mainly focused on business news
  • ‘The administration resorted to secrecy for political and security reasons’

TEHRAN, Iran: Iran shut down a newspaper on Monday after it published remarks by an expert who said the official figures on coronavirus cases and deaths in the country account for only 5 percent of the real toll.
Mohammad Reza Sadi, the editor-in-chief of Jahane Sanat, told the official IRNA news agency that authorities closed his newspaper, which began publishing in 2004 and was mainly focused on business news.
On Sunday, the daily quoted Mohammad Reza Mahboobfar, an epidemiologist the paper said had worked on the government’s anti-coronavirus campaign, as saying the true number of cases and deaths in Iran could be 20 times the number reported by the Health Ministry.
He also said the virus was detected in Iran a month earlier than Feb. 19, when authorities announced the first confirmed case. He said they held up the announcement until after the commemorations of the anniversary of the 1979 Islamic Revolution and parliamentary elections earlier that month.
“The administration resorted to secrecy for political and security reasons,” he said, and only provided “engineered statistics” to the public.
He also criticized testing efforts and warned of a renewed outbreak next month as universities hold entrance exams and people mark major Shiite holidays.
Iran’s Health Ministry has reported a total of nearly 330,000 cases and 18,616 deaths, including 189 fatalities in the last 24 hours.
Authorities in Iran have come under heavy criticism since the start of the pandemic because of their reluctance to impose the kind of sweeping restrictions seen elsewhere in the region. Iran is home to the deadliest outbreak in the Middle East.