Uzbekistan Housing Buyers Face Frozen Savings as Escrow Reform Stalls

132 developers checked, thousands of buyers left seeking help

Uzbekistan's Competition Development and Consumer Protection Committee received more than 1,700 complaints about developers between January and September 2026. Its examination of contracts offered by 132 construction companies across 12 regions found that 77.3% lacked a suitable deadline for returning buyers' money when an agreement ended, while 50.8% contained no penalty for late delivery.

The committee secured about 14.5 billion soums in recalculations in consumers' favour after examining complaints, mainly about construction quality and delayed handovers. Across the sector, violations involving the purchase of homes before completion reportedly caused nearly 3,000 people losses totalling 668 billion soums in 2025.

Behind those figures is a simple problem: families pay for homes that are still being built, but developers can receive and use the money before delivering the apartments. When construction stalls, buyers may face years without either the promised home or access to their savings.

A system intended to protect those payments was scheduled to become mandatory on January 1, 2026. By early November, the compulsory escrow mechanism for this type of construction had still not begun operating, while legislation intended to support it remained under consideration.

The dispute surrounding Imarat Development brings together several parts of the problem: missed completion dates, contested deductions from refunds, construction defects and a criminal investigation. It also shows why returning the original payment, even when that happens, may leave a household financially worse off after years of waiting.

What inspectors found in the contracts

The committee's examination covered developers in Tashkent city and 11 provinces. Its findings extended beyond late construction: many agreements left basic questions about repairs, refunds and the final price unresolved, or gave the developer greater control over them.

The committee recorded the following problems:

• 77.3% of contracts omitted a refund deadline or set one inconsistent with the initial payment conditions.
• 63.6% omitted a warranty period after handover.
• 59.1% mainly reflected the developer's interests.
• 54.5% omitted an obligation to correct defects during the warranty period.
• 50.8% omitted a penalty for construction delays.
• 33.3% did not specify a clear handover date.
• 30.3% were drawn up only in Russian, which the committee identified as a breach of state language requirements.

Some contracts allowed developers to retain between 4% and 15% of the amount paid when a buyer cancelled. Others made refunds dependent on selling the apartment to somebody else, or allowed the company to raise the price unilaterally.

A refund tied to a future sale leaves a family waiting for an event controlled largely by the developer. Without a firm repayment date, buyers cannot reliably plan another purchase or recover money needed for other expenses.

A separate review presented in July 2026 examined 129 contracts. It found no developer liability for delays in 51%, no warranty period in 84%, and provisions favouring developers during recalculations in 80%. The two examinations covered different groups of contracts, with both finding repeated gaps in protection.

How a cancellation can consume a deposit

A hypothetical apartment costing 500 million soums shows how the wording of a penalty can change a buyer's losses. If the household has paid a deposit of 150 million soums and the contract allows a deduction of 10% to 12% of the full price, the developer can seek to retain 50 million to 60 million soums.

That deduction would consume one third to two fifths of the money already paid. A clause calculated against the full apartment price is therefore much more costly than the same percentage applied only to the deposit.

Imarat customers raised complaints about deductions calculated against the total purchase price in September 2025. Marat Hamdamov, publicly described as the company's founder, said deductions had been applied to certain buyers during the final stage of construction and that other customers who cancelled were receiving their money in instalments.

The Competition Committee's Tashkent regional office instructed the company to return one Sergeli City buyer's payment in full. The national committee has also described contractual restrictions on consumer rights as unlawful and submitted proposals to the relevant authorities following its wider examination.

Developers' own delay penalties can be much smaller. At a daily rate of 0.01% of a 500 million soum contract, compensation would be 50,000 soums a day, or 18.25 million soums for 365 days. Where contracts cap compensation at 5% or 10% of the price, further delay eventually stops increasing the contractual payment owed.

Imarat buyers describe missed deadlines and refund disputes

Dilorom Yutayeva said she obtained her contract from Hamdamov on January 6, 2024, and paid 400 million soums for an apartment due by October 30, 2025. After the deadline passed without delivery, she sought her money back.

Jahongir Muhiddinov said he had fully paid for apartments scheduled for handover in December 2025. When that date passed, he tried to obtain information about construction progress but said he received no clear answer.

Dilnoza To'ychiboyeva said she signed her agreement in February 2024 and requested cancellation and a refund after repeated postponements. According to her account, company representatives initially persuaded her to wait, but the company later cancelled the agreement itself and sold the apartment to another buyer.

Tashkent police said some complainants also sought refunds because the residential buildings were in Quyi Chirchiq district, in Tashkent province, rather than within the capital. Imarat's office was in Tashkent's Sergeli district. For those purchasers, the administrative location of the property became another reason to challenge the transaction.

Hamdamov attributed problems to a dispute with other founders. He said he had been excluded from projects, including Sergeli City and Bristol City, and alleged threats against himself and his family. Olim Mamatov, who introduced himself as Imarat Development's director, later said relations between Hamdamov and the other founders had improved and that Hamdamov might return to work on the projects.

Construction findings and the criminal investigation

Construction inspectors identified problems at Sergeli City in July 2025. Work on blocks A9, A10, A11, D1 and D2 had proceeded without the required state registration. Inspectors also found cavities in concrete columns, water beneath foundations and the absence of drainage required by the design.

The inspection authority ordered the defects corrected and temporarily halted construction on those blocks. Hamdamov responded that work had been temporarily suspended rather than stopped permanently and said the company was acting within the law.

Tashkent police subsequently announced a criminal case following buyers' complaints under Article 168 of the Criminal Code, covering fraud, and Article 192-11, concerning abuse of authority by officials in nongovernmental organisations. Police did not disclose the number of applicants or the estimated total damage. Hamdamov was also reported to have been detained and made a suspect in the investigation.

An earlier case, opened in October 2025, concerned officials of Perfect-Mansions and construction at Tuzel Park without the necessary registration and permits. That project had been advertised under the Imarat Development brand. Authorities had not explained whether the two investigations were connected.

Mamatov promised delivery of 16 Sergeli City blocks by January 2027, out of 61 planned for the project. Those 16 blocks represent about 26% of the planned total. Completion of that promised group had not been confirmed.

Escrow was promised, but the timetable slipped

A presidential decree dated January 27, 2025, set out a transition to escrow for construction funded through buyers' contributions. Human rights activist Abdurahmon Tashanov has criticised the failure to complete that transition, arguing that the responsible ministries and parliament should account for the delay.

The main dates trace the gap between the announced policy and its implementation:

• January 27, 2025: The presidential decree established the transition timetable.
• July 1, 2025: Escrow was scheduled to become available voluntarily.
• January 1, 2026: Its use was scheduled to become compulsory.
• January 2026: The Justice Ministry explained that the legislation needed for mandatory use was still missing.
• July 28, 2026: The Legislative Chamber approved the construction bill at its first reading.
• Early November 2026: Mandatory escrow for this market had still not started operating.

The bill concerns construction of apartment buildings and other property through contributions from purchasers. Approval at a first reading means legislators have accepted its general approach; further consideration is needed before it becomes law.

During parliamentary discussion, deputies called for some proposed Criminal Code provisions to be clarified before the second reading. No date was given for final passage or the start of compulsory escrow.

What a protected bank account would change

Escrow places a buyer's money in a special bank account rather than immediately transferring it to the developer. The bank releases the funds after agreed conditions have been met. In the proposed housing arrangement, that would separate the collection of buyers' payments from the developer's immediate spending decisions.

The National Committee for Urbanisation and Sustainable Development of the Housing Market says the mechanism would reduce fraud and the misuse of purchasers' money. It has called the loss of both promised housing and access to refunds unacceptable and urged faster implementation.

The proposal also provides for bringing another developer into a project when serious problems prevent the original company from meeting its obligations. That approach aims to keep construction moving so buyers can receive homes rather than rely entirely on recovering money from a failed developer.

Escrow addresses the custody of money. Contract requirements address a different part of the transaction: what must be built, when it must be delivered and what happens if either side breaks the agreement. Buyers need both a protected payment mechanism and enforceable promises about the property they are purchasing.

Why returning the same sum can still leave a loss

A family that pays 500 million soums at the beginning of 2024 and receives the same amount back at the end of 2026 has spent three years without access to that money. During the wait, prices can rise, and the household may also lose the chance to earn interest or use the savings elsewhere.

The inflation figures cited for this example are 9.8% in 2024, 7.3% in 2025 and a forecast of 7% for 2026. Compounded, those rates would raise the general price level by about 26%. The returned 500 million soums would then buy roughly what 397 million soums bought at the start of the period.

In that calculation, the loss of purchasing power is about 103 million soums, even though the numerical balance is restored. The final figure depends partly on whether the 2026 inflation forecast is realised.

Replacing the apartment is another calculation. If a contracted home costs 500 million soums initially and an equivalent property later costs 800 million, the household needs another 300 million to make the same purchase. That example describes a replacement cost gap; the figures are illustrative, and compensation would depend on the applicable law and the individual case.

Contracts must also protect the promised home

Blogger Umid G'ofurov has called for mandatory minimum contract terms, including defined penalties and construction plans attached to agreements. His concern extends beyond delivery dates to promised parking, playgrounds, open space and the appearance of completed buildings.

An attached plan gives buyers and inspectors something specific to compare with the finished property. A clear warranty states how long the developer remains responsible for defects, while a repair clause sets out the obligation to correct them. The committee's findings show that many examined agreements omitted one or both.

G'ofurov has also warned that developers may have an incentive to delay, refund an old payment and resell an apartment at a higher price. Disputes over sunset clauses in Australian property contracts illustrate a related problem: clauses intended to end prolonged uncertainty were used by some developers seeking to cancel older sales as prices rose. Legislative changes in affected states restricted developers' ability to cancel without purchaser consent or court approval.

For Uzbekistan, the immediate decisions concern the pending bill, the rules governing bank accounts and minimum obligations in purchase agreements. The Competition Committee has advised buyers to examine contracts carefully, seek legal advice where necessary and take unlawful terms to the competent authorities or courts.

January 2027 is the next concrete delivery date given for 16 Sergeli City blocks. For purchasers across the wider market, the unresolved reform timetable determines how much longer new payments will continue to reach developers without the compulsory protection promised for January 2026.

Key Points

• The Competition Committee received more than 1,700 developer complaints between January and September 2026.
• An examination of 132 developers found inadequate refund deadlines in 77.3% of contracts and no delay penalty in 50.8%.
• About 14.5 billion soums was recalculated in consumers' favour after complaints were examined.
• Mandatory escrow was scheduled for January 1, 2026, but had not begun operating by early November.
• Police opened a criminal case following Imarat buyers' complaints; construction inspectors had also identified defects at Sergeli City.
• A company representative promised 16 Sergeli City blocks by January 2027.
• Delayed refunds can leave buyers facing reduced purchasing power and a higher cost of replacing the promised apartment.