Published on and written by Cyril Jarnias
In just a few years, The impact of tourism on Uzbekistan’s real estate market has profoundly transformed historic cities, mountain resorts, business districts, and even some villages. What was, in the mid-2010s, a relatively closed and opaque market for foreign investors has become one of the most dynamic playgrounds in Central Asia, driven by a wave of economic reforms, an explosion in visitor numbers, and a deliberate state-led push for tourism.
Tourism and economic growth are transforming Uzbek real estate: development of international hotels, ‘heritage hotels’ in listed buildings, residences for travelers, major complexes in Charvak, conversions into tourist apartments in Samarkand and Bukhara, and coworking spaces and high-end offices in Tashkent for new businesses.
Tourism’s Takeoff Changes the Real Estate Equation
For a long time, Uzbekistan remained a niche destination despite the allure of the Silk Road myth. Since the second half of the 2010s, the situation has shifted. Reforms initiated under President Shavkat Mirziyoyev, massive visa liberalization, international promotion, and infrastructure modernization have triggered a near-continuous growth in arrivals.
In the first ten months of 2025, the country recorded 9.7 million international visitors, a 50% increase compared to the same period in 2024.
Simultaneously, domestic tourism is also exploding. The “Travel around Uzbekistan!” campaign and the development of products for residents drove internal travel to 22.7 million in 2024, with targets of 24 million domestic trips by 2026 and 25 million by 2030. This dual pressure, external and internal, creates a structural demand for accommodations, services, short-term rental housing, as well as for commerce and offices related to tourism activities.
The Uzbek state has set ambitious strategic goals through its ‘Uzbekistan–2030’ Strategy and its tourism strategy for 2040. These plans aim to attract 20 million foreign tourists by the end of the decade, double tourism’s contribution to GDP (from 3.5% to 7%), and generate over $6 billion in tourism service exports. This strategic framework provides visibility for real estate projects in the sector and reassures investors.
A Booming Real Estate Market, Driven by Services and Tourism
The macroeconomic backdrop is also favorable. Uzbekistan’s GDP reached around $82 billion in 2024, with an annual growth rate of 5.5% to 6.5%, one of the highest in Central Asia. Since the economic liberalization begun in 2016, the country has been moving away from a model focused on agriculture and mining extraction towards services, processing industries, technology, and tourism.
In this context, the real estate market has seen a clear acceleration. Before 2017, the average annual appreciation of properties only increased by 1 to 3%. Between 2017 and 2020, the rise increased to 5–7%, then to 7–9% between 2020 and 2022. Since 2023, the market has shown an average annual increase of 9 to 12%, with tourism-related segments being even more dynamic.
Projected annual appreciation rate for tourism-related assets in Uzbekistan over the next five years.
This movement is not limited to iconic cities. The entire Uzbek commercial market is developing rapidly: demand for office space is increasing with the arrival of investors and international chains, retail is modernizing, logistics platforms are multiplying to serve an economy more integrated into regional trade. But it is the tourism component that gives this boom a particular meaning, by directing a growing share of capital towards heritage cities and new leisure hubs.
Tourism, Flows, and Real Estate: A Trio of Key Figures
To measure the scale of The impact of tourism on Uzbekistan’s real estate market, three sets of data interact: visitor numbers, tourism revenues, and accommodation capacity.
| Indicator | 2023 (approx.) | 2024 | 2025 Trend |
|---|---|---|---|
| International visitors (millions) | ~7 | 7.96 to 10.2 depending on sources | 9.7 (first 10 months) |
| Domestic trips (millions) | n.d. | 22.7 | target 24–25 (2030) |
| Tourism service exports ($ Billions) | 2.144 | 3.519 | 4.4–4.8 targeted |
| Hotels and similar accommodations (units) | ~1,387 | 2,383 | + in strong growth |
| Hotel rooms (units) | ~34,300 | 38,075 | continuous progression |
This rapid growth translates almost mechanically into a supply deficit in some sought-after areas, pushing prices higher and encouraging developers and individual owners to position themselves in tourism.
Samarkand, Bukhara, Khiva: The Revaluation of Historic Centers
The cities of the Silk Road – Samarkand, Bukhara, Khiva – concentrate a large part of international tourist interest. They are all UNESCO World Heritage Sites, home to a dense fabric of religious and civil monuments, and are at the heart of public enhancement programs.
The Uzbek government is betting on heritage enhancement to stimulate tourism and real estate through the ‘Pearls of Ancient History’ program. This program plans for the restoration of 745 cultural sites and the creation of 20 open-air museums. In Samarkand, this strategy materializes with the development of the Silk Road Samarkand tourist complex and the reconstruction of the international airport, whose capacity is tripled to strengthen the city’s status as the ‘gateway to tourism’.
This strategy has visible effects on real estate demand. Investors primarily target:
– Boutique hotels in converted old buildings.
– Tourist residences and charming apartments for short-term rental.
– “Heritage hotel” projects that combine heritage preservation and hotel operation.
The figures confirm the financial attractiveness of these investments.
| City / tourist area | Average price range (2025, $/m²) | Estimated tourist rental yields | Expected annual appreciation |
|---|---|---|---|
| Tashkent (center) | 600 – 1,200 | 6 – 8% (long-term) | 9 – 12% |
| Samarkand (historic areas) | 450 – 700 | 9 – 12% (short-term rental) | 9 – 14% |
| Bukhara (old center) | 400 – 650 | 9 – 12% (cultural tourism) | 9 – 14% |
A typical scenario modeled for a “historic property in Samarkand” intended for tourist rental suggests a total return over five years of 110 to 130%, combining rental income and value increase. In other words, tourism does not just fill rooms: it is durably reconfiguring the ownership structure and price hierarchy within historic cities.
In some cities, the ‘Heritage Hotels of Uzbekistan’ program offers public-private partnerships to transform cultural sites into charming accommodations. The state funds part of the restoration work and grants temporary tax benefits (exemptions from profit tax, property taxes) as well as customs facilitation to private operators. Although the catalyst is tourism, the implementation is in real estate and land use.
Tashkent: The Testing Ground for the “Tourism – Real Estate” Couple
The economic capital of nearly 3 million inhabitants, Tashkent accounts for about 30% of the country’s real estate transactions and embodies the current phase of densification and upscaling. The Tashkent City project – 80 hectares in the heart of the city, with mixed-use towers, convention centers, a massive 225,000 m² mall, five-star hotels – served as the trigger.
The presence of international brands like Hilton, Hyatt, InterContinental, Marriott as well as numerous restaurant and retail franchises reinforces the city’s attractiveness for tourists, businesspeople, and expatriates. The average national hotel occupancy rate is around 56%, with an average daily rate (ADR) of $69, but the capital shows significantly higher levels in both occupancy and average price.
The upscaling of tourism in Uzbekistan, particularly in Tashkent, is directly reflected in short-term rental figures. Vacation rental market data concretely illustrates this sector’s influence on the local real estate market.
| STR Indicators (short-term rental) – Tashkent | Average Value |
|---|---|
| Number of active properties | 625 |
| Average monthly revenue per property | $475.52 |
| Average Daily Rate (ADR) | $64.17 |
| Average occupancy rate | 36.37% |
| Average capacity (number of travelers) | 3.5 persons |
The top 10% of properties in Tashkent alone generate nearly $1,900 in monthly revenue, with an occupancy rate exceeding 78% and an ADR above $100. A “typical property” (median) fluctuates around $708 in monthly revenue and $51 per night. In a context where regulations on these rentals are described as “light” in terms of constraints, this niche is attracting more and more owners and investors.
A Reconfiguration of the Residential Supply
This shift towards the short term has social and urban effects seen in other capitals, which are also beginning to manifest here: a portion of the residential stock is diverted from the traditional rental market to be reformatted into tourist accommodations, which weighs on affordability for residents and can accentuate speculation in some central neighborhoods.
Detailed data on the composition of the short-term rental market in Tashkent shows the scale of this phenomenon:
– Over 92% of listings are for entire homes.
– 83% are apartments.
– One-bedroom units represent 53% of the supply, and units with one to two bedrooms account for 75.7% of the total.
– More than half of the properties are configured to accommodate 2 to 4 people, the ideal profile for visiting couples and small families.
These properties are concentrated around major tourist and commercial hubs: Amir Temur Square, areas near large parks, the old town (Eski Jo‘va), sectors close to business centers and modern malls. Tourism, in other words, is redrawing micro-markets within the capital.
Mountain Resorts, Resorts, and New Attraction Hubs
The tourism boom is not limited to museum cities. A significant portion of new real estate projects is taking place in natural areas: Charvak and the Bostanlyk region, Parkent and the mountainous foothills, the Aidar-Arnasay lakes, the Fergana Valley, Zaamin, Farish, Bakhmal, or the thermal resorts of Chartak.
The flagship projects give an idea of the scale of the ambitions.
Sea Breeze Uzbekistan at Charvak: The Mega-Project That Changes Everything
Around the Charvak reservoir, in the Bostanlyk district, the Sea Breeze Uzbekistan project, led by Azerbaijani Emin Agalarov, embodies a new generation of integrated developments. Over 577 hectares, it plans hotels, cottages, swimming pools, sports infrastructure, restaurants, shopping centers, a bridge, and event spaces. The announced investment volume varies from $5 to $7–10 billion, making it one of the largest tourism-real estate projects in the country.
The joint venture benefits from a direct 25-year lease, renewable with priority, with a symbolic land fee of 0.01 times the market value, payable over five years. The land will be divided into plots that can be sub-leased to other developers or hoteliers. The state retains land ownership, capturing a large part of the value, while investors handle the development and operation of the constructions.
The impact on the local real estate market will be multiple: increase in values around Charvak, emergence of sub-markets for villas and second homes, development of a supply of services and commerce to fuel this new leisure hub, and, potentially, population movements if urbanization progresses.
Parkent and Chartak: The Rise of Mountain and Wellness Resorts
The Parkent mountain resort project, covering 1,200 hectares around Mount Oltin Bel, plans ski slopes, cable cars, 3 to 5-star hotels, chalets, restaurants, wellness zones. An Austrian operator specialized in alpine infrastructure has been involved, and the complex is to be developed in phases. Its target capacity of 15,000 visitors per day illustrates the sought-after scale.
This is the number of hectares currently being developed in Chartak to expand tourism and balneotherapy.
In these mountainous areas, the state plans to develop 25 new tourist routes by 2030, facilitating access and increasing the real estate potential of land that was previously relatively peripheral.
An Avalanche of Incentives Directing Investment Towards Hospitality and Tourism
If The impact of tourism on Uzbekistan’s real estate market is so rapid, it is also because the arsenal of public incentives is particularly generous for anything related to the visitor economy.
The measures go well beyond typical sector exemptions.
Subsidies and Tax Relief for Hotels
For hotels rated 3 stars or more, several mechanisms combine:
A set of tax incentives and subsidies to encourage the construction and operation of hotels.
Partial reimbursement of costs for new hotels commissioned before end-2026. Subsidies per room: 40 million soums (3 stars, min. 60 rooms) and 65 million soums (4 or 5 stars, min. 120 rooms). Bonus for accessible rooms.
90% reduction in land tax and property tax for hotels and shopping centers > 5000 m² until early 2027.
Reduced rates to 1% for turnover tax, property tax, and land tax in 28 tourist zones (2022-2025). Social contribution also at 1% for the sector.
Ability to fiscally depreciate the cost of hotel buildings over a reduced period of just two years.
These incentives, combined with subsidized loans (up to 30 billion soums in regional centers, 10 billion elsewhere, for 7 years with a 2-year grace period) and partial coverage of franchise fees for major international brands, transform the balance sheets of projects once considered too risky into highly profitable investments.
Land Facilitation and Public Equity Participation
The state is also experimenting with more innovative mechanisms. Starting in 2026, entrepreneurs who win land at electronic auctions for tourism projects will not have to pay for the land directly: the value of the plot will be converted into a capital share and the state will become a shareholder in the project up to that amount, never exceeding 50%. Developers can repurchase this share over ten years, with a 20% discount for immediate settlement. This approach reduces the capital entry barrier while aligning public and private interests.
Maximum amount in dollars of the daily tourist tax per person that will be eliminated from 2026 in certain areas of Uzbekistan.
For projects considered strategic, such as “green hotels” over five stories, specific subsidies are planned, provided they are delivered before the end of 2026. Furthermore, imported equipment and materials not produced locally can be exempt from customs duties.
Result: hospitality and tourist complexes have become, according to investment rankings, the third most sought-after asset type by investment volume in the country’s commercial real estate.
Short-Term Rentals: A Bridge Between Mass Tourism and Heritage Building Preservation
Beyond major hotels and resorts, the most discreet but potentially most transformative tool for The impact of tourism on Uzbekistan’s real estate market is the rise of short-term rental platforms like Airbnb or their regional equivalents.
Data collected on Tashkent, Samarkand, and Bukhara highlights this evolution.
| City | Active STR Properties | Average Monthly Revenue | Average ADR | Average Occupancy Rate | STR Regulation |
|---|---|---|---|---|---|
| Tashkent | 625 | $475.52 | $64.17 | 36.37% | Light |
| Samarkand | 119 | $236.89 | $51.59 | 26.72% | Light |
| Bukhara | 47 | $211.29 | $55.90 | 18.73% | Light |
In all three cities, almost the entire supply consists of entire homes, mostly apartments. Clients are overwhelmingly foreigners (95% for Tashkent, for example), who book with average lead times of about 24 days, longer in spring and shorter in winter.
This structuring of the tourist rental market has several real estate consequences:
Tourist rentals standardize properties for short stays and generate added value for well-located buildings. It also encourages the renovation of old buildings to bring them up to international comfort standards, thereby revaluing the built heritage.
The risk, already observed in other cities worldwide, is seeing too large a proportion of the housing stock shift to short-term rentals, with upward pressure on residential rents and social tensions. For now, Uzbek regulations remain flexible, and the market is still far from a massive shift. But as the number of visitors increases – especially the high-spending visitors targeted by national strategies – the issue of balance between tourist attractiveness and the right to housing will likely gain prominence.
Foreign Investors: Between Tourism Opportunities and Land Constraints
Another essential aspect of The impact of tourism on Uzbekistan’s real estate market concerns the growing appetite of foreign investors. FDI flows increased by 73% over a recent period, reaching at least $7.2 billion in 2023, and a growing number of foreign companies – notably Chinese – are positioning themselves in the mining, industrial, as well as services and real estate sectors.
In Uzbekistan, as in other former Soviet republics, land belongs to the state. Foreigners (individuals or legal entities) cannot own it. They can only own the buildings and structures on the land, through long-term use rights (25- or 49-year leases, renewable under conditions). Access to this built property and, in some cases, to a residence permit, is subject to minimum investment thresholds that vary by region.
| Region / city | Minimum investment for property (residency by investment) |
|---|---|
| Tashkent (city/region) | $300,000 to $400,000 |
| Samarkand, Bukhara | $200,000 |
| Other regions, Karakalpakstan | $100,000 |
In practice, this means that a foreigner wishing to invest in a boutique hotel in Samarkand or a short-term rental building in Bukhara must structure their project to meet these thresholds while obtaining a long-term lease on the land. Investors’ rights are theoretically protected by the Law on Investments and Investment Activities, which guarantees the possibility of repatriating profits and protects against nationalization, but administrative complexity, regulatory volatility, and corruption risks (the country ranks 121st out of 180 on Transparency International’s Corruption Perception Index) necessitate engaging local experts.
Minimum investment in dollars required to obtain unlimited residency in Uzbekistan through property acquisition in the regions, under the program launched in 2025.
Knock-on Effects on Retail, Offices, and Logistics
The tourist footprint extends far beyond hotel rooms or vacation rentals. It irrigates the entire commercial real estate sector.
In Tashkent, the office market totals about 520,000 m² of leasable space, with a vacancy rate of about 24% and average rents of $34.3/m² for Class A/A+ buildings and $24/m² for B/B+. Demand for high-end offices is supported by international companies, regional headquarters of hotel chains, travel agencies, airlines, and tourism-related service companies (marketing, events, travel tech).
The retail supply in Tashkent reaches nearly 478,500 m², with average rents of about $40/m² per month.
The country is also playing its card as a logistics hub between Asia and Europe. The increase in tourist flows reinforces the economic viability of projects to modernize airports (Tashkent, Samarkand, Urgench), new road infrastructure (4,000 km of major roads brought to highway standards, 800 km of toll highways connecting Tashkent, Samarkand, Andijan, Bostanlyk, Karshi), and high-speed rail networks (extension of the Afrosiyob line). For real estate investors, this densification of infrastructure opens new corridors of opportunity around train stations, interchanges, airport areas, where hotels, offices, warehouses, and retail will have a role to play.
Between Risks and Potential: A Transformation to Manage
At this stage, the benefits of The impact of tourism on Uzbekistan’s real estate market seem obvious: creation of thousands of jobs, increase in tax revenues, enhancement of cultural heritage, modernization of outdated infrastructure, diversification of an economy long dependent on raw materials. The country has been distinguished as one of the most dynamic in the world for tourism development by the World Tourism Organization and the World Economic Forum, and it is accumulating international awards.
But the speed of the transformation carries risks that will need to be managed.
Several of these are already identified in studies and by sector players:
Several risk factors must be considered: the seasonality of flows compromising annual profitability, a shortage of skilled labor in luxury, urban housing tensions due to tourist conversion, environmental fragility of natural sites in the face of overdevelopment, erosion of yields by inflation and currency volatility, as well as legal complexity requiring expert support.
For now, the government is striving to anticipate some of these challenges through long-term strategies (Tourism Strategy 2040, gradual infrastructure modernization, regulation of PPPs, road safety plans to reduce an economic cost estimated at 2.6 to 3.8% of GDP), but the equation remains delicate: how to maximize the benefits of tourism without succumbing to the pitfalls of over-specialization or a real estate bubble?
A New Urban Geography Being Born
Whether it is the silhouette of Tashkent, transfigured by the towers of Tashkent City and the Nest One skyscraper, the opening of complexes like Silk Road Samarkand, the extension of slopes at Amirsoy, or the future road network towards mountain areas, we are witnessing the accelerated birth of a new urban and territorial geography.
Urban and tourism dynamics are transforming: historic cities are reinventing their heritage through real estate, seaside and mountain resorts are becoming metropolitan hubs of leisure, and the capital is establishing itself as a business and convention hub for Central Asia. These evolutions are visible in the overlay of maps showing tourist flows, land values, rental yields, hotel investments, and major public projects.
In this shifting landscape, the impact of tourism on Uzbekistan’s real estate market is not limited to a few visitor numbers or a general price increase. It redefines how Uzbeks live, work, move, and envision their cities, while attracting a new generation of foreign investors and visitors. The challenge now will be to convert this effervescence into a sustainable, inclusive, and long-term profitable model, without sacrificing either housing affordability for residents or the authenticity of the heritage that attracts travelers.
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Cyril Jarnias is an independent expert in international wealth management with over 20 years of experience. As an expatriate himself, he is dedicated to helping individuals and business leaders build, protect, and pass on their wealth with complete peace of mind.
On his website, cyriljarnias.com, he shares his expertise on international real estate, offshore company formation, and expatriation.
Thanks to his expertise, he offers sound advice to optimize his clients' wealth management. Cyril Jarnias is also recognized for his appearances in many prestigious media outlets such as BFM Business, les Français de l’étranger, Le Figaro, Les Echos, and Mieux vivre votre argent, where he shares his knowledge and know-how in wealth management.
