BEIRUT: Lebanon’s real estate development companies at the annual show at the Beirut International Exhibition and Leisure center said the days of Lebanese expats and Gulf Arabs buying up luxury Lebanese property at inflated prices are a thing of the past – at least for now. Today’s buyers are primarily Lebanese residents making conservative decisions on their property purchases.

“The demand is completely different than it was two years ago,” says Joe Kanaan, president of Sodeco Gestion, a Beirut-based real estate development company. “Before, the construction was for people coming from abroad, Gulf Arabs and Lebanese expatriates. Now, it’s Lebanese on a smaller budget.”

He says the demand for large, lavish flats have been replaced with lower-priced, more practical spaces. Whereas before, many of his clients sought 400-square-meter homes, now they are buying 80-square-meter spaces. And Gestion’s average price per square meter has dropped by about 25 percent.

Other real estate companies at the BIEL exhibit reported similar trends.

“Last year, most of our clients came from abroad,” said Sewar Sleiman, sales and marketing manager at iGroup for construction and investment, which started participating in the exhibition two years ago. “This year they’re mostly young Lebanese couples that have come back from Dubai to find homes.”

“The demand now is for small apartments, usually around 136 square meters,” she added.

Hassan Dergham, co-founder of Dergham and Hamdar, says that the drop in Lebanon’s luxury real estate market, like the regional turmoil, will improve again with political stability.

“Before, there was a boom. It’s all connected to politics,” he said. “The market goes down, but it always goes up again. Hopefully this won’t last long.”

Elie Hakme, managing partner at Hakme Group, notes that the decrease in purchasing power of his clients is combined with land prices in Beirut that remained high over the past year, making it difficult to lower his prices.

“The price of land in Beirut is still high, so I can’t drop my prices,” he said.

For Pierre Chehwane, CEO of Menazel International and a first-time participant in the show, the exhibition in Beirut was a chance to give exposure to his newly expanded brand in Lebanon, which until this year only had offices in the Gulf and Paris, where he sells Lebanese property, mainly to the Diaspora community.

“I went to Saudi Arabia 11 years ago, and now I’m investing in Lebanon,” he said. “I had to come back here.”

Like most of his fellow developers at the exhibit, Chehwane didn’t seem too bothered by the loss in confidence of the Lebanese property market in investors from abroad, instead seeing new opportunity in the switch to the local market.

Kanaan recalled that until the financial crisis “the market was going up, up, up. People didn’t realize it wasn’t a real market.” For him, the new reality isn’t necessarily a bad thing, saying: “The market should be local.”