Plots’ prices in the local private property sector drastically increased in the past few years due to low supply and mounting demand, according to a report released on Monday by the Kuwait Real-Estate Union.
Prices of land plots allotted for private housing significantly increased, in the past seven years. Rate of a square meter which stood at KD 334 in 2007 jumped to KD 698 in 2014, rising by 109 percent. Lands’ prices have been climbing by 11 percent per year since 2014. However, in 2013, they jumped by 27 percent, the report said.
Property prices’ high jumps add to financial burdens, suffered by Kuwaiti families, compelled to save, totally, their income for 10 years to be able buy a residence. Residential areas in Kuwait are built on 1,000-sq-km lands. The population is estimated at four million and the national income at $200 billion, thus the property hikes are at the level of the increases in the Europe and American sectors.
Up to 118,000 plots of lands can be specialized for the private housing in Kuwait. Nearly 141,000 others have been developed for constructing houses. The remaining 44,000 plots are occupied, however they are centered, by 61 percent proportion, in Sabah Al-Ahmad residential district, seaside Al-Khairan, Jaber Al-Ahmad and northwest Al-Sulaibikhat.
With exemption of the above-mentioned districts, percentage of lands proper for housing does not exceed 10.8 percent of the overall number of these lands. This situation pushes the high prices of houses and lands to higher levels in most regions.
Despite very low numbers of private houses, rental sector has witnessed noticeable activity. The report mentions several kinds of leased houses; such as those that are part of large residences, leased by the landlord to Kuwaiti families – estimated at more than 4,300 units, the rent of which reaches as high as KD 371 as compared to KD 313 for apartments.