Local Real Estate Market – July 2019

The latest released data by the Ministry of Justice -Real Estate Registration and Authentications Department- (after excluding the crafts activity and the coastal strip system) indicate an increase in real estate market liquidity during July 2019 versus June 2019 liquidity. Total value of contracts and agencies traded during July scored KD 425.3 million which was a 61.6% increase than its counterpart value in June 2019 which scored KD 263.2 million, while it is lower by -20.5% when compared with July 2018 liquidity that totalled KD 535 million.

Trading during July 2019 was distributed between KD 382.4 million to contracts and about KD 42.9 million to agencies. Number of real estate deals in this month scored 736 deals of which 691 contracts and 45 agencies. The highest share in real estate deals went to Al Ahmadi Governorate by 257 deals representing about 34.9% of the total number of real estate deals. Mubarak Al Kabeer Governorate came second with 142 deals representing 19.3%. While the lowest share went to Al Jahra Governorate by 49 deals, representing about 6.7% of the total.

Value of private residential activity scored KD 165.1 million, rising by 88.1% compared with KD 87.7 million in June 2019. Its contribution percentage increased to 38.8% of the total real estate trading versus 33.3% in June 2019.  The monthly average value for private residence trading in the last 12 months scored KD 127.2 million. This means that July trading value was higher by 29.8% than the average. The number of deals for this activity increased to 498 deals versus 276 deals in June 2019. Accordingly, the average value of private residence activity deal scored about KD 331 thousand versus KD 318 thousand in June 2019, an increase by 4.3%.

Value of investment housing activity scored KD 155.4 million, higher by 28.3% from KD 121.1 million in June 2019. Its contribution to total liquidity decreased to 36.5% versus 46% in June 2019. Monthly trading average value of investment housing activity during 12 months scored KD 120.1 million. This means that trading value during July 2019 was higher by 29.4% compared with the last 12 months’ average. Moreover, its deals increased to 163 deals compared with 119 deals in June 2019. Therefore, the average value per deal for investment housing scored KD 953 thousand versus KD 1 million in June  2019,  representing a decrease by -6.3%.

Commercial activity trading value increased to KD 102.3 million or by 92.4%, compared with KD 53.2 million in June 2019. Its percentage out of total real estate trading value rose to 24% in July versus 20.2% in June 2019. Average value of commercial activity trading in 12 months scored about KD 51.5 million. This means that total trading value in July was higher by 98.4% than the last 12 months’ average. However, its deals scored 73 deals compared with 83 for June 2019. The average value per deal for July 2019 scored KD 1.4 million versus KD 641 thousand average for June 2019, a 118.7% increase. Moreover, 2 deals occurred for stores activity in July 2019 valued at KD 2.6 million, compared with 1 deal at KD 1.3 million in June 2019.

When comparing total July 2019 trading with July 2018, we note that real estate markets liquidity decreased from KD 535 million to KD 425.3 million, a -20.5% rise as mentioned previously. The decrease included the investment housing activity by -34.3%, commercial activity by -18.4% and private residence activity by -4.6%.

If we compare total trading value since the beginning of the current year until July 2019 with its 2018 counterpart, we note a decrease in total real estate market liquidity from KD 2.162 billion to KD 2.126 billion, a -1.6% deline. If we assume that market liquidity level will continue at the same level for the remainder of the year (5 months), market trading value would amount to KD 3.645 billion, which is KD 13.9 million higher than the total for last year, representing a 0.4% growth above 2018 level which scored KD 3.631 billion.