Despite a massive surge in demand during the 2022 FIFA World Cup, residential rents in Qatar have experienced a decline on a monthly basis since March this year. This drop comes in the wake of a notable increase in the number of vacant apartments available in the country during the first half of 2023, as stated in a report by Cushman & Wakefield, reported Al-Qabas Daily.
The company’s head of consulting and research, Johnny Archer, stated that rents remained stable throughout the first quarter of 2023. However, the supply of apartments will add downward pressure on rents.
The company’s report stated that in addition to the supply of new apartments in recent months on the Pearl Island and in Lusail, an increase in the availability of premium apartments led to downward pressure on rents.
The introduction of approximately 7,000 apartments in the city of Al-Wakra resulted in a significant boost to the supply of modern living spaces. This, in turn, created direct competition for the existing residential neighborhoods in Al-Wakra and Mesaimeer.
The report further stated that while occupancy rates in the main villa compounds in Doha remain strong, there was an indication of increasing vacancies in the villa sector in general, while rental levels have not decreased to the same degree as in the apartment sector. The return of rent-free incentives to attract new tenants indicates a decline in net rents.
The majority of one-bedroom apartments on The Pearl Island can now be rented in between 6,000 and 8,500 riyals per month, depending on the location and quality of the building. Most of the 3-bedroom units are now available on the island at prices ranging from 13,000 to 15,500 riyals per month, according to Zawya.
In the Fox Hills area, one-bedroom apartments are now available at a price ranging between 5,000 and 6,500 riyals per month, while the prices of 3-bedroom units now range between 8,500 and 10,000 riyals per month, as the number of residential unit sales decreased by 22.6% in April and May compared to the same months of 2022, as stated in the review, citing figures from the Planning and Statistics Authority (PSA).
The imminent establishment of the Real Estate Regulatory Authority as announced by the Ministry of Municipality will increase transparency in the market and enhance legal protection for investors.
The Qatar Central Bank also announced a series of amendments to the real estate financing (mortgage) regulations, which aim to protect the financial sector and strengthen the residential sales sector, and redefined loan rates to value and maximum mortgage terms for Qatari citizens and expatriates.
These measures are likely to attract investors and homeowners in the long term, the impact is unlikely to be noticeable in the short term due to recent increases in interest rates for mortgage customers, which have affected the sales market.
Archer indicated that the success of the new amendments to the real estate financing regulations in Qatar will depend on a number of external factors, including:
1- Macroeconomic performance.
2 – Diversification of the economy.
3 – Attracting new residents with good salaries and opportunities.
4 – International and regional competition.
5 – Interest rates (mortgages and affordability).
Read Today's News TODAY... on our Telegram Channel click here to join and receive all the latest updates t.me/thetimeskuwait
