As Russia’s real estate market faces a slowdown, Russian developers are increasingly exploring opportunities in Uzbekistan, one of Central Asia’s fastest-growing housing markets, according to a report by Yakov and Partners.
Uzbekistan’s economy has maintained stable growth of around 7% annually, with foreign investment expanding by roughly 18% per year and 2024 foreign direct investment reaching a record $28 billion. The country’s population exceeds 37 million and continues to grow, particularly among working-age residents, while household incomes rise by an average of 5% per year, fuelling demand for quality housing in urban centres.
The residential sector is expanding rapidly, with multi-apartment housing completions increasing by an average of 14% annually between 2020 and 2024. Experts forecast annual commissioning could reach 13.8 million square metres (148.54msf) by 2030, more than double the 6.2 million square metres (66.74msf) recorded in 2024. Accelerated urbanisation and a high proportion of obsolete housing (over 60% of stock predating 1990) are key drivers of this growth.
“Rapid urbanisation and rising incomes are driving strong demand for modern housing, creating fresh opportunities for Russian developers in Uzbekistan.”
Yakov and Partners note that average development project margins in Uzbekistan range from 10-20%, with certain segments offering 19-90% or higher returns. Business- and premium-class housing remain particularly attractive, as current supply often falls short of buyers’ expectations in terms of design, layouts, and service quality.
While opportunities are compelling, experts caution that entry barriers include limited availability of land, high plot prices, underdeveloped financing mechanisms, currency volatility, borrowing costs, and stringent seismic-resistance requirements. Joint ventures with local developers are recommended to mitigate risks, allowing foreign companies to leverage local knowledge and share financial responsibilities.
Russian developers bring expertise in large-scale integrated projects, including urban district planning and renovation of outdated housing, giving them a competitive edge in delivering modern, high-quality housing products that meet Uzbekistan’s evolving urban needs.
According to Vitaly Zuev, Engagement Manager at Yakov and Partners, “Uzbekistan’s real estate market is becoming one of the key growth points for developers amid the transformation of the Russian market. Competitive advantage will favour companies that combine financial discipline, deep understanding of local conditions, and the ability to scale high-quality projects aligned with both buyer expectations and long-term socio-economic goals.”
