Kuwait's Real Estate Sector Weakens
Due to some factors, the real estate market in Kuwait has continued its sluggish activity that dampened sales and turned away investors.
A report from the Kuwait Times, which used data from the Ministry of Justice, showed that the relatively vibrant 2014 of the industry along with the plummeting oil prices were enough to make the sector decline so suddenly. It showed that for the first three-quarters of this year, the number of real estate properties sold has decreased by 26 percent, reaching the KD 2.3 billion little against the same period last year.
Although the majority of real estate markers and indices have shown positive figures, the housing sector has been underperforming since last month. At present, Kuwait has seen a total of KD 1,065 million sales to date. In September alone, the sales reached KD 82.2 million.
Both the full value of sales in KD, as well as the volume of sold properties on a year-to-date basis, has recorded a 24 percent decrease and 29 percent, respectively as opposed to the same period last year. Among other factors, the decline in sales and volume has been attributed to the move of the government to distribute 12,000 plots every year, which saw an increase from last year.
Meanwhile, a separate article from the Select Property noted that Kuwait's real estate market will continue to slide down until the fourth quarter of this year. The report cited data from Kuwait-based Alshahed. The report continued that while the low turnout recorded in Kuwait in the third quarter of this year will continue to the end of 2015, it will further decline by as much as 30 percent in the next of the year.
"The market will witness a drop in the number of real estate deals during the fourth quarter due to continued fears of the regional situation and [the fact that] 95% of real estate companies were subject to substantial losses, reaching to 6% of the capital in some companies," Alshahed was quoted by Select Property.