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Join Date: 04 Mar 2015
Location:  KuwaitPosts: 87 |
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Rents in Kuwait starting to fall? – Expats’ departure, high supply cause drop |
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Rents in Kuwait starting to fall? – Expats’ departure, high supply cause drop
KUWAIT: A decrease in rents seems to be slowly moving from southern areas to include Farwaniya, Salmiya and Hawally, where hundreds of flats remain vacant looking for tenants. According to observers, this has caused a retreat in rent, and also led to suggestions to add a maximum annual increase clause to lease contracts, similar to Dubai. ‘For Rent’ and ‘Vacant Flats’ signs are starting to be seen outside many apartment buildings after disappearing for almost three years, said the observers who spoke to Al-Rai on the condition of anonymity. Meanwhile, real estate sources said that rent for a one bedroom flat had dropped from KD 230 to KD 210 and a two bedroom flat dropped from KD 370 to KD 340, which indicates even further drops in view of a minimum 60 percent drop in demand for leased residential flats. In this regard, real estate experts said that with the expected retreat in rent values and the number of current vacant units, many owners would be left with only two options: reduce rent value or sell their buildings before their prices drop. Commenting on the same issue, Kuwait Real Estate Owners Union member Qais Al-Ghanim said that rent values were not expected to increase again within the near future. Ghanim attributed this to many factors including the fact that many expatriate families are either leaving permanently or temporarily during the summer to escape the skyrocketing costs of living in Kuwait. Ghanim added that another reason was investors’ fear of purchasing investment buildings that are in high supply now. “It is unlikely for rent values to rise till the end of this year,†said Abdul Aziz Al- Dughaishem, Chairman of the board of Al-Dughaishem Real Estate Company. NBK’s reports showed meanwhile a 40 percent retreat in the prices of investment real estate as well as a 30 percent drop in the number of real estate deals till the end of March Source:Kuwaittimes http://news.kuwaittimes.net/rents-in-kuwait-starting-to-fall-expats-departure-high-supply-cause-drop/ |
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