Arab News, Mon, Jun 03, 2024 | Dhu al-Qadah 26, 1445
Bahrain’s real estate sector holding steady, report says
Bahrain:
Bahrain’s real estate sector remained steady in the first quarter of this year,
with 6,124 sales transactions, representing a marginal 3 percent year-on-year
decline, an analysis showed.
According to a report released by real estate
services firm Savills, the value of transactions in the property market
also witnessed a slight drop of 1.2 percent in 2023 to $2.92 billion compared to
the previous year.
However, the volume of real estate transactions in
the country grew by 24.1 percent in 2023 compared to 2022.
“Despite challenges, the real estate sector
continues to grow, driven by government support, rising investor confidence, and
an increasing demand for real estate in the region,” said Hashim Kadhem, head of
professional services, residential sales and rental market at Savills.
According to the report, home buyers in Bahrain
are becoming more strategic in the market, primarily focusing on mid-range
properties.
Moreover, more affordable housing options with
improved amenities have shifted the market dynamics in favor of tenants.
Kadhem added: “Bahrain’s coastal location and
flourishing high-end tourism industry continued to drive demand for luxury
waterfront properties, which appeal to buyers seeking exclusivity and comfort.”
The report revealed that a stream of projects is
expected to be handed over this year, which could further widen the gap between
demand and supply and potentially affect capital values in the short term.
According to the study, capital values of
apartments grew slightly by 0.3 percent in the first quarter of this year
compared to the previous three months.
On the other hand, high-end villas witnessed a 4.5
percent dip in capital value in the first quarter compared to the same period of
the previous year.
Office sales and rental market
The report revealed that Bahrain’s office sector
real estate market experienced a quiet period in the first quarter of this year,
with businesses renewing leases in high-quality Grade A properties.
According to Savills, capital values for
these remained stable in the first quarter, driven by an increase in supply.
Grade A office spaces enjoy a premium over the
average rent prevailing in the area due to their location, infrastructure, and
young age.
The report also suggested that co-working spaces
also witnessed high demand in the first quarter, mainly from startup companies
and businesses looking to downsize.