For too long, real estate sector in Lebanon remained one of the core sectors to assess the economic health of the country and determine its forthcoming standing. The undeniable importance of real estate activity is reflected by the sector’s substantial contribution to the country’s Gross Domestic Product (GDP) which was estimated around 14% by 2013. Yet, the lack of data in the sector undermines the valuation of real estate demand and supply. The size of current local demand cannot be assessed accurately as updated income distribution and housing ownerships are not available, noting that remittances from the large Lebanese diaspora contribute substantially to the uphold of domestic demand as well as the growth potential for the real estate.
As a matter of fact, and similarly to the majority of Lebanon’s economic sectors, real estate remained highly dependent on the country’s political and security conditions. For instance, total real estate transactions (local and foreign) during 2010-2013 slumped 25.6% to 69,198. Actually, 2013’s political factors have sent the “Political Stability and Absence of Violence” (PSAV)index for Lebanon to the 14th lowest level among 214 countries. Lebanon’s index kept revealing very low figures over the past 8 years, hovering between a lower band of 3 Percentile Rank (PR) in 2007 and a higher band of 8 PR in 2009 alluding to the country’s persistent instability. The latest index of 2010 stood at 6 and steadied at this level till 2013. Worth mentioning, the index scores the variation of political stability in a country correspondingly to the occurring incidents and their weight as a Percentile Rank (PR) among all countries from 0 (lowest political stability) to 100 (highest political stability).
To Read the full report, click on the link below: Real Estate Activity in 2014 Sluggish Performance amid Intensifying Challenges