Yerevan apartment prices have climbed sharply this year, and Armenia's Central Bank has raised its bank capital buffer while stopping short of calling the market a bubble.
According to International Investment, citing Armenia's Cadastre Committee, the average price per square meter in Yerevan has risen by 23.5% since the end of 2025. Over the past 12 months the increase in apartment buildings was 20.3%; the two figures differ because the periods measured are not the same. Growth varies widely by district: Shengavit (+29.2%), Erebuni (+29%), Nor Nork (+28.8%), Nork-Marash (+28.7%) and Malatia-Sebastia (+28.3%) lead, while Arabkir rose 18.6% and Kentron 12.7%. The center is still the priciest area: in August the average was AMD 993,000 per sq. m in Kentron, AMD 735,700 in Arabkir and AMD 505,000 in Shengavit. Demand remains strong. The World Bank reports that apartment sales in Yerevan nearly doubled in July 2026 compared with July 2025, naming buyers from Russia and the Armenian diaspora among the factors. The article stresses, however, that prices cannot be explained by foreign buyers alone: local housing needs, mortgage availability and the wish to invest savings also play a role, and official statistics do not separate each group's share. Mortgage lending has accelerated after a prolonged slowdown, and the share of borrowers with two or more mortgages is growing. Income tax refunds on mortgage interest generally no longer apply to new loans in Yerevan after January 1, 2025, with exceptions for certain previously approved projects. On the supply side, Armenia built 5.09 million sq. m of housing in 2020–2025 versus 2.39 million sq. m in 2006–2011 (nationwide figures). In July the value of construction work was up 26.5% year on year, and the sector's debt to banks exceeded AMD 1 trillion by August. For rental investors, Central Bank Governor Martin Galstyan noted in May 2026 a rising ratio of purchase prices to rents, which lengthens payback periods; maintenance, taxes and vacancy periods also reduce net income. On October 20 the Central Bank decided to raise the countercyclical capital buffer for banks to 2.25% of risk-weighted assets. A previously approved 2% requirement takes effect on February 1, 2027, followed by the new level on May 1. Galstyan has not ruled out a fall in housing prices but said a sharp decline is not inevitable and declined to call the situation a bubble. The market's direction in 2027 will depend on demand and the pace of new completions.