Quarterly Report Qatar Q2 2024: Residential Market Overview

Residential sales transactions increased in Q2, despite a general downward trend since 2021

There is a strong underlying demand for the higher specification buildings in prime locations, with tenants taking advantage of rental reductions that have characterized the market since 2022. Demand has been highest in Viva Bahriya and Floresta Gardens with tenants attracted by the high quality of finishing, property management services, and all-inclusive rents provided by building owners. Vacancy rates tend to be higher in Porto Arabia, particularly in older towers, where apartments are often owned by individual landlords.

In Lusail, occupancy rates are highest in the Marina District, where new towers typically generate high demand. The quantity of new apartments in districts such as Fox Hills and Al Erkiyah means that vacancy rates are higher, with more flexible lease incentives available.

Large masterplanned apartment projects to the south of Doha and in Al Wakra, including Madinatna and Al Janoub Gardens, have increased supply significantly and put pressure on occupancy rates and rents in the mid-market as developers compete to attract tenants. Rents in these major developments have reduced since 2022 and now range from QAR 3,500 for a one-bedroom apartment to QAR 5,800 for a three-bedroom apartment.

Residential villa compounds continue to enjoy high occupancy and stable rents across most of Doha. The relative lack of availability compared to the apartment sector has resulted in upward pressure on rents in some of Doha’s more popular compounds. While rents have generally remained stable so far this year, some compounds no longer offer the rental incentives to new tenants that had been commonplace in recent years.

According to the latest statistics released by the Planning and Statistics Authority, the number of residential sales transactions increased by 16.4% over the first five months of the year compared to 2023. Transactional activity has fallen by 44% from 2021, when record sales were registered after the introduction of new laws governing property ownership.

The sales market continues to be dominated by owner occupiers rather than investors. Apartment sales are being driven by residents looking to secure residential permits and avoid paying rent. Purchasers are also being encouraged by the increasing flexibility of structured payment plans for new off-plan sales being offered by many developers in Lusail’s various residential districts.

Cushman & Wakefield Quarterly Report Qatar Q2 2024

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