Residential rental rates in Qatar have started to show more pronounced declines after years of prolonged growth, according to a new report by real estate consultants CBRE.
Its H1 2016 Qatar MarketView said over recent months, demand levels have weakened substantially amid widespread company downsizing and lower levels of recruitment in both the public and private sectors.
CBRE said so far, declines have been most prevalent within the higher tiers of the residential market, with rental rates falling by over 10 percent in some cases since the start of the year.
However, the report added that the market average decline is actually around 5 percent over the past six months.
Mat Green, head of research & consulting UAE, CBRE Middle East, said: "Whilst rentals are tumbling for some prime units, rates for low to mid-end residences have actually remained relatively steady.
"This has been driven by the lower levels of new supply in this segment, sustained population growth and deflationary wage pressures which have forced some employees to seek lower cost accommodation alternatives amidst an uncertain economic environment.
"This trend is likely to pick up pace in the short term as vacancy rates rise, particularly in freehold locations such as The Pearl Qatar where there is an active secondary market," said Green.
Qatar has around 145,000 completed residential units, including those with commercial components, and over the next three years, CBRE expects to see the addition of around 28,000 new residential units, with most to be delivered in locations such as Pearl Qatar, Lusail City and West Bay.
Source: Arabian Business