Jul 06 2009
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Real estate sales in Kuwait down 17% in May
A total of 314 sales transactions were registered at a value of KD80.1 million (Dh1.02 billion). The sales volume fell 17 per cent from the previous month. The residential sector saw moderate growth with value and number of transactions rising by three per cent and seven per cent, respectively.
The drop in May sales values came largely from a decrease in commercial sales, which saw a 66 per cent decline. In May, three suburbs that are among the most active markets for vacant plots of land - Abu Futaira, Ishbilia and Funaitees - continued to attract buyers and real estate investors.
Vacant plots in these areas alone accounted for 17 per cent of all residential property sold during the month.
Average transaction sizes during the month were up eight per cent for apartments, while residential and commercial properties fell by four per cent and 24 per cent, respectively.
The average real estate sales during the first five months of 2009 dropped by 55 per cent in value and 49 per cent in number compared to the same period last year. Most of the decline in sales value occurred in the apartment sector, where sales values dropped by 63 per cent. The residential and commercial sectors were not spared, with sales values down by 57 per cent and 14 per cent, respectively.
In May, approved loans by the Savings and Credit Bank (SCB) were down by 26 per cent and 29 per cent, month-on-month in number and value, respectively, to their lowest levels since April 2008. The SCB approved 340 loans with a value of KD12.5m. Compared with April, approved loans for construction of new homes and for purchase of existing homes fell by 37 per cent and 15 per cent, respectively. However, for the first five months of 2009, the volume of approved loans was up by 96 per cent from the comparable period in 2008 (driven by the last distribution of land plots).
Meanwhile, the SCB disbursed KD13.7m in loans during May, nine per cent lower than the previous month, though the five-month average was ahead by 11 per cent compared to the previous year.
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