The real estate sector in the Gulf region’s three largest economies is expected to perform well in the first half of 2024 as a result of high oil prices and strong GDP growth, according to a Kuwaiti think tank.
In Saudi Arabia, the world’s largest oil exporter, the sector is projected to record “strong recovery” through 2024 due to high oil prices and forecast GDP growth of four percent, Markaz said in a report on Sunday.
It cited projections by the International Energy Agency (IEA) showing average oil prices are expected to be as high as $93 in 2024 against IMF estimates of $79.7 a barrel.
“We expect the real estate sector in Saudi Arabia to pick up in the first half of 2024… our optimism is based on an expected growth in non-oil activities, the boom in the hospitality sector and an increase in the Kingdom’s spending on infrastructure,” it said.
In the UAE, the second largest Arab economy, GDP is projected to swell by around 4 percent in 2024 compared with 3.4 percent in 2023 and this will have a direct positive impact on real estate and other non-oil sectors, the report said.
It noted that property activities in the UAE recorded strong growth in the 3rd quarter of 2023, adding: “The sector is expected to continue this positive trend in the first half of 2024 mainly in the hospitality, residential and office activities.”
“As for Kuwait, our expectations are that the real estate sector will record positive stability, supported by several positive factors, including a projected 3.6 percent GDP growth….the sector will then pick up towards the end of 2024 after it remained largely stable through 2023,” the report said.
(Writing by Nadim Kawach; Editing by Anoop Menon)
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