Kabul’s Real Estate Market Faces Struggles Amid Economic and Security Concerns

Construction companies in Kabul are reporting a decline in apartment sales and purchases over recent months, attributing this downturn to economic challenges, security concerns, and water shortages.

Drop in Apartment Sales in Kabul; Construction Companies Express Concerns

Several construction firms in Kabul have announced a significant decrease in the buying and selling of apartments in recent months. These companies cite economic difficulties, water scarcity, and regional developments as primary factors contributing to this trend.

An employee from one of the construction firms indicated that prices have dropped considerably, further cooling the real estate market in Afghanistan. He stated, “Since the beginning of the year, particularly over the last six or seven months, transactions have plummeted.” The employee, who requested anonymity due to security concerns, also highlighted the impact of the ongoing U.S.-Iran tensions on the market, noting that many apartments are being purchased by Afghans living abroad.

The deputy of another construction company in Kabul identified security issues as a key reason for the market’s stagnation, remarking, “Currently, people’s motivation to invest in real estate has declined due to the unstable situation.” He also emphasized the acute nature of the water shortage, stating, “This problem is being felt intensely.”

Real Estate Market Developments and Their Impact on Citizens

Some owners of real estate agencies attribute the stagnation in private apartment sales to the housing projects being implemented by the Taliban government. Recently, the Ministry of Urban Development and Housing of the Taliban announced that the construction of residential blocks and urban projects in Kabul is ongoing.

Sardar, an owner of one of the real estate offices, commented on the variance in housing prices depending on location, construction quality, and amenities, noting that newly constructed apartments in the city’s New Town area are selling for between $750 to $900 per square meter.

In recent years, the demand for housing has surged with the large-scale return of migrants to Afghanistan. Meanwhile, many residents are complaining about difficulties in finding rental homes and the rising rent costs. This situation has led some investors to shift their focus towards construction activities in Kabul.

Despite this, the growing population in the capital has exerted increased pressure on urban resources and services, giving rise to new challenges such as water and electricity shortages, along with air pollution.