Jordan apartment sales price up 14pc
Amman, February 19, 2014
The apartment sales prices in Jordan rose 14 per cent year-on-year but the rental rates remained relatively unchanged at two per cent due to increased supply, said a report.
Although rental rates in Jordan experienced no significant changes during the fourth quarter of 2013, the apartment sales prices jumped eight per cent in the final quarter averaging 14 per cent in certain areas over the past 12 months, according to a report by Asteco.
The stable economy and calm political arena has led to an improvement in market sentiment thus resulting in a hike in apartment sales prices, stated the property expert in its Q4 2013 report.
"Sales prices over the past year in areas such as Al-Rabiah (up 24 per cent), Sweifieh (up 19 per cent) Der Ghabar (up 14 per cent) and Um Othainah (up 13 per cent) witnessed strong growth predominantly from Jordanian nationals," stated John Stevens, the managing director of Asteco Property Management.
"The investors were primarily interested in smaller studio apartments, with good potential leasing prospects. Owner-occupiers preferred larger apartments ranging from 250 to 300 square metres," he added.
However, increased supply matching demand resulted in apartment rental rates remaining relatively unchanged compared to the third quarter of 2013, while year-on-year growth amounted to two per cent on average.
"To buy an apartment in Sweifieh now costs on average JD1,175 ($1,651) per square metre, an annual increase of 19 per cent, however to rent a two-bedroom apartment in the same district would cost a tenant around JD7,875 per annum, a year-on-year increase of just 2 per cent."
In contrast to the residential leasing sector, office leasing rates declined marginally by two per cent, compared with the previous quarter.
According to the report, this was partly due to a disparity between landlords who wanted to lease full or half floors and tenants who only wanted space up to 200 sq m. Average office space in Wadi Saqrah would now lease for JD 98 per square metre per annum a drop of 3 per cent year-on-year.
Asking prices for commercial property sales remained depressed with few transactions, which were accentuated by developers raising their prices by 8 per cent to offset a rise in construction costs.
“We anticipate a slowdown in the office market in 2014, especially for properties for sale, as supply increases and demand is limited, which will likely put downward pressure on prices,” added Stevens.-TradeArabia News Service