Qatar apartment rents up on high demand
Doha, July 8, 2012
The demand for one and two-bedroom apartments in Qatar pushed rental rates up 8 per cent in the country, while the villa rents rose 4 per cent on limited supply, according to a new report.
Although on average, only marginal rental increases were witnessed across Qatar’s residential locations, strong demand for the one and two-bedroom apartments pushed their rental rates up by 8 per cent compared to the previous year, said property expert Asteco in its 'Q2 2012 report for Qatar'.
Jed Wolfe, the managing director, Asteco Qatar said, “Demand for one-and two-bedroom apartments is now beginning to outstrip supply in various locations, particularly in the Diplomatic District and the Pearl-Qatar, both offering good quality accommodation, something tenants from mature overseas markets, will not compromise on.”
Rental growth for the remainder of the year may be limited, as a significant amount of apartments are scheduled to complete by the year end, but Wolfe remained upbeat.
“If demand continues to grow at this pace, the market could acquire a healthy supply and demand balance particularly in the one- and two-bedroom category,” he added.
The highest average rental rate for either a one-or two-bedroom apartment at the Pearl-Qatar in Q2 was QR9,750 ($2679.8) and QR13,000 per month respectively. The lowest rents were found in Najma where one-and two-bedroom apartments averaged QR3,625 per month and QR5,125 per month, respectively.
Overall average villa rental rates were also up 4 per cent due once again to supply and demand dynamics. The most expensive area, West Bay Lagoon, averaged QR23,500 per month for a four-bedroom villa, while in Al Khraytiyat a similar property costs QR9,750 per month.
“The most modern, high quality and well serviced compounds, are now developing waiting lists for prospective tenants, such is the demand,” Wolfe stated.
According to him, the residential sales market witnessed no material change in Q2, enquiry levels remained constant, but with a marked increase for one-and two-bedroom apartments, following the rental trend.
That demand predominantly came from individual Qatari investors using property as an alternative to holding cash reserves, he stated.
“The smaller unit sizes also allow investors to limit their risk, by depositing limited equity, when using a mortgage to finance the purchase,” said Wolfe.
One major news story that surfaced recently was that United Development Company (UDC) the developer of the Pearl-Qatar, announced that it planned a reduction in the master community service charge of around 33 per cent, remarked Wolfe.
“This reduction is due to take effect imminently and when combined with the possibility that Qtel could acquire the full communications network to offer voice, broadband internet and TV entertainment, will have a positive effect on investors through lower operational costs and added-value for tenants,” he added.
On the office sector, Asteco said the rental rates remained static with no significant movement since the first quarter of the year.
However continued supply through to 2013 will still outstrip improved demand especially from companies involved with infrastructure projects, it noted.
Currently fully fitted offices under 500 sq m in good locations are most sought after. West Bay continues to lead the market, commanding QR195 per square metre per month, it added.-TradeArabia News Service