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The Effects Of Western Bank Crashes On The Real Estate Market In Lebanon.

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01. May 2023
The Effects Of Western Bank Crashes On The Real Estate Market In Lebanon.

The recent collapses of Credit Suisse Bank and Silicon Valley Bank, as well as threats that other banks could crash, have caused concerns about the global economy. People are worried about the rising interest rates in many countries, which creates uncertainty about what to do with their money in banks. The stock market is also facing challenges, and cryptocurrency is questionable, leaving many seeking alternative investment options. Real estate is often seen as a safe investment opportunity, and it is expected to be one of the most sought-after options.


While the current economic climate may affect the real estate market, it is expected to have minimal impact on the luxury real estate market in Lebanon. Investors looking for luxury properties are not necessarily seeking cheaper housing options or necessities. Rather, they are looking for stable investments, which luxury real estate can provide. However, this does not necessarily mean that luxury real estate prices will rise, as wealthy investors have the opportunity to invest worldwide. This also applies to big commercial and industrial property investors. Consequently, it is unlikely that the prices of luxury real estate in Lebanon will be affected.


On the other hand, the mid to lower-end residential and commercial real estate markets in Lebanon are expected to experience an uptick in demand. With the recent bank collapses in Lebanon, Lebanese investors are seeking alternative investment options so as to not lose their money again. This has led to an increase in demand for more affordable and accessible mid to lower-end residential and commercial real estate properties in Lebanon.


As interest rates continue to rise globally, investors are seeking tangible assets, such as real estate, to provide a stable investment option. This trend is expected to continue, leading to an increase in demand for real estate in Lebanon, particularly in the mid to lower-end residential and commercial markets.


The difference in the effect on the Lebanese real-estate market, as a result of global bank collapses in 2008 and 2023,  is directly related to the Lebanese economy being much stronger, and the banking sector having the trust of the people. Real estate in Lebanon was cheaper, and Lebanese people and foreigners were buying a lot in Lebanon. However, the current situation is entirely different because the Lebanese people no longer trust the banking system. 


In conclusion, the demand for real estate in Lebanon is expected to continue to increase, providing investment opportunities for those seeking a stable and reliable investment option.