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Kuwaiti real estate sector predicted to drop in 2008
Real estate news By Rania El Gamal
September 20, 2007
KUWAIT: Investors in the real estate sector in Kuwait face a lot of obstacles which drive them to other neighboring countries where the investment environment is more friendly, says an official at the Public Authority for Housing Welfare. "Other countries - for example Dubai and Oman - don't have the same complications that are found here in Kuwait. The long bureaucratic procedures push the Kuwaiti investors to go to other countries," Faisal Al-Khalaf, Deputy Director General of the Public Authority for Housing Welfare told reporters Tuesday evening at a real estate exhibition. "I wish some of the real estate projects in other Arab countries are here in Kuwait," he added.
Al-Khalaf predicts that prices of real estate in Kuwait will also to go down by the end of 2008. "By the second half of 2008, the (booming) housing market will not be like now. The government will still spend millions of Dinars on new residential and real estate projects but the prices will not continue (as high) as now," he said. "Moreover, investments in the real estate sector, especially the commercial and industrial construction sector, will not be as profitable in the coming years as now," he added.
Kuwait's real estate sector continued to grow in value by 57 percent over the first two quarters of 2007 compared to the same period in 2006, with almost 1,000 sales transactions recorded in June 2007, with an estimated value of $855 million, according to a recent report by the National Bank of Kuwait (NBK). Average prices were also up 8 percent over the previous year for residential and commercial units.
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