15/05/2026
Why Property Keeps Getting More Expensive:
Real estate prices tend to rise due to a structural imbalance between supply and demand, combined with inflationary pressures and increasing construction costs. Over the long term, growth is supported by limited land availability, ongoing infrastructure development, and the perception of property as a safe-haven asset.
Key drivers of price growth:
1. Strong demand vs. limited supply
Housing demand remains consistently high, especially in major cities, while new development takes time and is constrained by land availability. This imbalance naturally pushes prices upward.
2. Inflation and rising construction costs
The cost of building materials (such as steel, cement, and finishing products), along with logistics and labor, continues to increase. Developers pass these costs on to buyers, leading to higher prices per square meter.
3. Macroeconomic factors
Central bank interest rates influence mortgage affordability. Even in a high-rate environment, nominal property prices often continue to rise, largely tracking overall inflation.
4. Infrastructure development
New metro lines, roads, schools, and public amenities significantly enhance the attractiveness of an area, driving both demand and property values higher.
5. Investor behavior and market psychology
Real estate is widely perceived as a reliable store of value. This perception sustains demand even during periods of economic uncertainty.
While many believe that property prices “always go up,” the reality is more nuanced. In the long term, real estate often outpaces inflation, but in the short term, markets can experience periods of stagnation or correction.
Fadi Alsalem
Private Office Advisor fadialsalem