With continued expatriate population growth the rental market in Bahrain has remained relatively strong, even given the effects of a prolonged economic downturn, said a report.

Apartment rents have only fallen by an average six per cent over the last six months with asking rents for a good quality two-bedroom fully-furnished unit now standing at around BD750 per month if it's a freehold property and BD700 ($1,856) per month for a non-freehold unit in the areas of Juffair or Seef District, Knight Frank's second half of 2010 property review said.

Villa rents over the same period have fallen by as much as 11 per cent and a four-bedroom gated semi-furnished compound property now has an average asking price of BD1,600 per month and freehold villas on schemes such as Riffa Views are quoting BD1,450 per month.

'We have seen that non-freehold apartments and villas have typically experienced larger rental falls in comparison to freehold property over this period,' the report said. 'This reflects the fact that a growing number of expatriates now prefer to rent in master planned projects such as Amwaj Islands which has helped to support rents.

'At these types of projects residents are attracted by the lifestyle benefits of having a waterfront location, shops and restaurants on their door step, a community experience and generally a higher standard finish of property.'

Turning to commercial property, the report points out that Bahrain remains a price sensitive market where affordable property is being sought after by national, regional and international businesses.

Prime accommodation that was once being quoted in the peak of 2007 and 2008 at more than BD13 per sq m per month is now being offered to prospective tenants at BD10 per square metre or less, the report said.

'This represents a negative shift of 35 per cent within two years taking prices back to 2006 levels.'

The prime properties in the areas of Government Avenue, Seef District and Bahrain Financial Harbour continue to offer the highest rates of all locations but rates of BD4 per square metre a month are now being offered in the Diplomatic Area, which was once the sole central business district. – TradeArabia News Service