Sep 12 2011
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Saudi, Kuwait property markets 'most attractive'
Saudi Arabia's residential segment remained the most lucrative exposure, GIH said, as demand significantly outpaced supply on growing population, business activity and an inherent shortage of residential units.
According to the Saudi Arabian Monetary Agency's Q2 inflation report, the index for housing rents and related items surged by 7.2 percent year-on-year after an 8.2 percent increase in Q1.
The report said Kuwait's private housing segment remained active in Q2 amounting for 55 percent of total transactions value although the commercial segment continued to suffer from oversupply with vacancy rates still averaging around 20-25 percent.
The study said GCC real estate still saw downward pressure on prices and rents in Abu Dhabi while commercial property was still suffering from oversupply across the Gulf region.
Dubai apartment rents decreased two percent in the second quarter of the year, following a similar fall in Q1. It added that villa rents maintained their Q1 levels without any significant declines.
Selling prices dropped by three percent for Dubai apartments led by Downtown Dubai, which dropped eight percent compared to Q1 and DIFC (down seven percent) on new supply, Global said.
"In Abu Dhabi, rents of both apartments and villas declined at a fast pace, negatively affected by new deliveries during the quarter," it added.
Apartment rents dropped another eight percent in the UAE capital in Q2, while villa rents dropped modestly on selective demand for ready to move in properties.
The report further said rents in Bahrain remained under pressure in Q2, but demand for affordable housing was still intact.
Oversupply of office and retail space continues to exert a downward pressure on rental and selling rates, it said.
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