Kuwait: In keeping with its commitment to empowering investors with vital perspectives and market insights for informed decision-making, Kuwait Financial Centre “Markaz” released a research paper on the implications of the new Kuwaiti law to tackle the monopolization of residential land. Prepared by the Markaz MENA Real Estate team, the paper details the terms and conditions, as well as the consequences and possible responses related to the recently introduced legislation that restricts undeveloped residential land held by individuals.

The report outlines the anticipated actions of landholders in response to the new restrictions and the details of the fees imposed by the new law. It also sheds light on the possible price fluctuations in the residential land sector and its overall consequence on the Kuwaiti real estate sector.

The report notes that the 'Anti-Monopoly Law on Land' is designed to curb feudal practices employed by traders. These practices involve controlling the supply and pricing of residential land by acquiring extensive plots and keeping them unused for extended durations, intending to sell them at inflated prices during periods of scarcity in the residential land market. Effective January 2026, the law imposes an annual fee of KD 10 per square meter exceeding the individual limit of 1,500 square meters of vacant residential land, with an increase of KD 30 per square meter every year until it reaches KD 100 per square meter per annum. 

According to Markaz’s report, landholders are likely to evade the fee by transferring their surplus land to their children. Since the law prohibits Special Purpose Vehicles (SPVs) from possessing private land, the report suggests that SPV-owned lands may be offloaded to circumvent the fee. Additionally, the report examines various alternatives, such as selling the land, choosing to retain ownership and paying the fee, and developing a minimum area as strategies for landowners to adapt to the new legislation.

The new regulation only applies to new landowners who have acquired over 1,500 square meters of unbuilt land after its implementation. Individuals who currently own excess land will not be included in this law, says the report. Noting that the law might not adequately address the prevailing housing problem, the report suggests other measures, such as increasing the supply of land or exploring other housing solutions through a modern common ownership law to develop quality residential units.

The research paper underscores Markaz’s unwavering keenness to keeping investors and clients informed of key laws and governmental reforms, offering crucial insights into how these changes impact individual investors and the real estate industry in Kuwait and the wider region. It also highlights the proactive approach of Markaz's team in staying abreast of the latest market trends, industry updates, and newly enacted laws.

About Kuwait Financial Centre “Markaz”

Established in 1974, Kuwait Financial Centre K.P.S.C “Markaz” is one of the leading asset management and investment banking institutions in the MENA region with total assets under management of over KD 1.21 billion (USD 3.94 billion) as of 31 December 2023. Markaz was listed on the Boursa Kuwait in 1997. Over the years, Markaz has pioneered innovation through the creation of new investment channels. These channels enjoy unique characteristics and helped Markaz widen investors’ horizons. Examples include Mumtaz (the first domestic mutual fund), MREF (the first real estate investment fund in Kuwait), Forsa Financial Fund (the first and only options market maker in the GCC since 2005), and the GCC Momentum Fund (the first passive fund of its kind in Kuwait and across GCC that follows the momentum methodology), all conceptualized, established, and managed by Markaz.

For further information, please contact:
Sondos Saad
Corporate Communications Department
Kuwait Financial Centre K.P.S.C. "Markaz"
Email: Ssaad@markaz.com