Aug 12 2012

Real-estate sales, mortgage activity surge in Oman during first 5 months

By Gulam Ali Khan Boosted by a surge in mortgage contracts, Oman's real estate sector is showing strong signs of growth as the traded value of properties and volumes increased substantially in the first five months of this year.

The statistics, released by the National Center for Statistics and Information (NCSI), revealed that the total value of traded properties in Oman during the first five months of this year increased 59.7 per cent to RO807.6mn compared to RO505.8mn in the corresponding period of the previous year.

The traded value of mortgage contracts jumped 94.6 per cent to RO555.9mn from RO285.7mn in the same period of 2011, while the number of mortgage contracts rose to 7,214 in the five-month period from 4,165 in the same period last year.

The traded value of sales contracts increased by 14.8 per cent to RO248.8mn from RO216.7mn last year, while the number of sales contracts rose to 32,656 from 21,642.

Property-market experts believe that with the availability of cheap mortgage funding, investor confidence has been restored in Oman's property market.

Philip Paul, country head at Cluttons, said that the availability of mortgage funds seems to be the key feature behind the growth in real-estate activity.

He said, "Banks are lending money for mortgages and interest rates are also favourable.

"Since last year more Omanis have joined the workforce due to Omanisation policies and salaries have also increased. So buyers' confidence has returned to the sultanate's property market and people are now ready to invest in properties."

Chris Steel, managing partner of Savills Oman, said that Oman's property market has seen strong peaks and troughs in recent years, but its future has never looked brighter.

In a recent report, Steel said, "The future is bright for property investment in the sultanate. The rationale behind this is simple; properties are starting to show owners net investment returns above prevailing bank interest rates.

" Combined with high levels of liquidity in the populace and favourable borrowing costs the market has very much bucked the international trend."

© Muscat Daily 2012

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