Doha: Qatar’s real estate frenzy which sent housing rents through the roof and priced long term residents out of their homes looks as if it’s here to stay as landlord anticipate an increase in overheads soon.
In an interview with The Peninsula Faisal Durrani – Partner – Head of Research at Knight Frank Middle East said the prime residential leasing market for apartments for instance has seen monthly rents grow by 22 percent over the last 12 months to an average of about QR13,100, with three-bedroom apartments at The Pearl commanding the highest lease rates. We feel this is mainly linked to the influx of new expatriate employees as COVID-19 restrictions abate, but also landlords who have moved to capitalise on any shortage in hotel rooms towards the end of last year. In any global residential market, temporary demand drivers take a few quarters to begin fading and the same is likely true for Doha.
Damantha Wilfred Project Director - Real Estate Investments said the housing rental prices in Doha started to increase drastically from the second quarter of 2022 due to the high demand created by the FIFA World Cup making a temporary bubble in the market.
Many including real estate professionals in the market predicted and expected a drop in the rental prices starting from the year 2023. However, the current situation as we speak shows that areas such as Lusail Marina, Lusail Fox Hills, The Pearl Qatar, West Bay, Corniche, West Bay Lagoons, etc are still on a much higher side while the prices in certain other areas of Doha had already been dropped considerably.
“In our professional opinion, Doha rental prices still needs to drop down in the coming second to third quarters of the year making a solid correction to the rental prices making a healthy, stable and a sustainable environment to both the Landlords and it’s tenants,” he said adding that there are many residential towers / buildings and compounds still vacant and on hold waiting to hit the market in the coming months of the year where the supply will be matched correctly to the demand of the population in the city making this much needed price correction in the real estate market by the end of second quarter of 2023.
Real estate experts observed a sharp rise in the number of property hunters after the World Cup speculating housing rentals to drop following the decline in demand for occupancy.
However, what is seen is the contrary with landlords sticking to the pre world cup rents anticipating taxes on utilities.
According to real estate experts resident seekers put on hold the search for apartments at the end last year when stories commenced going around about an increase in rents. Many even saw their rents rise sharply this year forcing them to look for new locations.
World real estate prices continue to fluctuate based on changes in borrowing rates and supply and demand.
According to the latest data by Global Property Guide, Qatar recorded the highest average monthly rent for two-bedroom apartments in the Middle East. The report showed that Qatar topped the list with an average rent of $3,742 (QR13,625) on a monthly basis followed by the United Arab Emirates with $2,208 (QR8,043).
