Last year witnessed continuing rise of ‘occupancy’ in investment properties (apartment buildings), along with relative stability of leases, according to Kuwait Real-Estate Association.
The association, in a report included in its annual report, “Al-Mursheld Al-Aqari,” indicated that there were “doubts,” in 2015, regarding the investment properties in 2015 after oil prices decline, coupled with decrease of economic activities in the Arabian Gulf countries, however these suspicions were not substantiated, thus the decline proved to be minimal, with the occupancy reaching as high as 94.3 percent.
However, the report noted that the very limited decline-if recorded-might have been linked to evacuating old buildings for demolishing, promoting new ones built at the same locations; therefore this does not signal decline of occupancy.
Estimates put number of apartment flats at some 320,000 at 13,000 investment plots, the report says, adding that the occupied ones amount to 302, 000 and empty ones at 18,000. Rate of flats’ non-occupation is “normal” at all times for some families change residence throughout the year.
The report rules out occupancy decline due to current market conditions, noting that the average monthly rent rose to KD 313 in Q2, 2015. Apartment rents climbed in the past two years by 18.5 percent, at a yearly rate of 8.9 percent, reaching the unprecedented level of KD 300 per month.