Local Real Estate Market – September 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 a great increase in real estate market liquidity during  September 2019 versus August 2019 liquidity. Total value of contracts and agencies traded during September scored KD 328.9 million which was a 127.8% increase than its counterpart value in August 2019 which was at KD 144.4 million, also higher by 55.8% when compared with September 2018 liquidity that totalled KD 211.1 million. Trading during September 2019 was distributed between KD 308.4 million to contracts and about KD 20.5 million to agencies. Number of real estate deals in this month scored 590 deals of which 560 contracts and 30 agencies. The highest share in real estate deals went to Al Ahmadi Governorate by 182 deals representing about 30.8% of the total number of real estate deals. Hawally Governorate came second with 114 deals representing 19.3%. While the lowest share went to Al Jahra Governorate by 42 deals, representing about 7.1% of the total. Value of private residential activity scored KD 146.5 million, rising by 108.2% compared with KD 70.3 million in August 2019. While its contribution percentage decreased to 44.5% of the total real estate trading versus 48.7% in August 2019.  The monthly average value for private residence trading in the last 12 months scored KD 131.6 million. This means that September trading value was higher by 11.3% than the average. The number of deals for this activity was at 423 deals versus 417 deals in August 2019. Accordingly, the average value of private residence activity deal registered at KD 346 thousand versus KD 324 thousand in August 2019, an increase by 6.8%.

Value of investment housing activity scored KD 103.1 million, higher by 90.1% from KD 54.2 million in August 2019. Its contribution to total liquidity decreased to 31.4% versus 37.6% in August 2019. Monthly trading average value of investment housing activity during 12 months scored KD 118.8 million. This means that trading value during  September  2019 was lower by -13.2% compared with the last 12 months’ average. Moreover, its deals increased to 127 deals compared with 67 deals in August 2019. Therefore, the average value per deal for investment housing scored KD 812 thousand versus KD 810 thousand in August 2019, representing an increase by 0.3%.

Commercial activity trading value increased to KD 75.9 million or by 313.4%, compared with KD 18.4 million in August 2019. Its percentage out of total real estate trading value rose to 23.1% in September versus 12.7% in August 2019. Average value of commercial activity trading in 12 months scored about KD 58.5 million. This means that total trading value in September was higher by 29.7% than the last 12 months’ average. However, its deals scored 38 deals compared with 46 for August 2019. The average value per deal for September 2019 scored KD 2 million versus KD 399 thousand average for August 2019, a 400.5% increase. Moreover, two deals occurred for stores activity in September 2019 valued at KD 3.4 million, compared with 1 deal at KD 1.5 million in August 2019.

When comparing total September 2019 trading with September 2018, we note that real estate markets liquidity increased from KD 211.1 million to KD 328.9 million, a 55.8% rise as mentioned previously. The rise included the commercial activity by 2272% (compared to one deal that occurred in September 2018 valued at KD 3.2 million) and private residence activity by 49.3%, while investment housing activity declined by -6.1% compared to their levels in September 2018.

If we compare total trading value since the beginning of the current year until September 2019 with its 2018 counterpart, we note an increase in total real estate market liquidity from KD 2.509 billion to KD 2.600 billion, a 3.6% growth. If we assume that market liquidity will continue at the same level for the remainder of the year (3 months), market trading value would amount to KD 3.466 billion, which is KD 165.1 million lower than the  total  for  last year, representing a -4.5% decline below 2018 level which scored KD 3.631 billion.