The market for leasing homes in Qatar is likely to show strong signs of growth in 2013 and 2014 as major infrastructure and construction projects get underway, according to EC Harris.
The market for leasing homes in Qatar is likely to show strong signs of growth in 2013 and 2014 as major infrastructure projects get underway, according to EC Harris.
The company’s latest report on the outlook for property financing states that Qatar is also set for a hotel building boom, with 5,000 new hotel rooms planned each year in the run-up to the 2022 Fifa World Cup.
The market for residential property sales in the emirate is likely to remain flat, though, and no major new office development is planned due to the continuing overhang of space from the last commercial boom.
The firm’s analysis of other markets states that the Middle East will be one of a number of hot spots for financing alongside other markets where GDP is expected to grow such as South East Asia, Brazil and Canada.
Saudi Arabia “will need to meet the challenge of maintaining inward investment in the face of potentially lower oil prices caused by the combined effects of increased supply from Iraq and US shale reserves,” it said.
However, it added that the record budget announced by the Kingdom, in which social infrastructure was a key feature, would fund a huge number of housing, education and healthcare schemes.
“With approximately 60% of the population below the age of 40, Saudi Arabia’s infrastructure and residential plans are
in response to actual, sustainable demand from a native population rather than reliant on expatriates or the tourism
sector, unlike many countries in the region.
“The mortgage law passed in late 2012 will have a significant impact on the residential market by increasing the ability of Saudis to own their own homes.”
Commercial development in the major cities also remains strong, particularily in Riyadh where the firm said that the sprawling King Abdullah Financial District (KAFD) and Business Gate are “now seeing improved tenant interest”.
“We also see Jeddah beginning to re-emerge as a key commercial centre with a number of large schemes also about to commence.”
The UAE has benefitted from capital flight from other parts of the region, but uncertainty over the fortunes of global markets “continues to restict the ability to raise debt funding and fuel real estate development”.
“Dubai is showing signs of recovery, with projects previously placed on hold being reviewed and restarted, as the
emirate looks to restructure to attract investment,” the report said. “Dubai’s leading developers are looking to maximise returns from existing assets with redevelopment plans ongoing for many of the emirate’s regional shopping malls.
“The strong business and tourism demands have also led to the refurbishment of several of the emirate’s older hotels where increased occupancy levels driven largely by the increase in length of stay, have improved the viability of otherwise marginal schemes.”