Demand for residential real estate in Lebanon stagnated in the fourth quarter of 2018, as reflected by the results of the Byblos Bank Real Estate Demand Index. The Index posted a monthly average of 51.2 points in the fourth quarter of 2018, nearly unchanged from 51.4 points in the third quarter of 2018 and increasing by 14% from 44.9 points in the fourth quarter of 2017. The fourth quarter results constitute the 20th lowest level in 46 quarters.

Real estate demand in the fourth quarter of 2018 was affected by the absence of concrete initiatives to stimulate housing demand, amid political uncertainties, stagnating consumer confidence and slow economic activity. As such, the Index’s average monthly score in the fourth quarter of 2018 came 61% lower than the peak of 131 points registered in the second quarter of 2010, and remained 53.4% below the annual peak of 109.8 points posted in 2010. Also, it was 14.1% lower than the Index's monthly trend average score of 59.6 points since the Index’s inception in July 2007.

In parallel, the Byblos Bank Real Estate demand Index posted a monthly average of 44.9 points in 2018, constituting a decline of 5.7% from a monthly average of 47.6 points in 2017. The limited decline of the Index reflects the continuous efforts by commercial banks to extend housing loans during the year, as banks met part of the demand by subsidizing mortgages from their own funds, as well as by offering regular housing loans. The other reason for the limited decline of the Index in 2018 is that stakeholders in the private sector have tried to fill part of the gap left by the suspension of subsidies, as some developers that are financially liquid have started to offer payment facilities to potential buyers that are similar to subsidized loans, until subsidies resume.