Here comes a trend? Residential rentals up 16% in Doha
Average residential rental in Doha has risen 16 per cent year-on-year due to increased demand from expatriate inflow and a lack of supply in the market, said a report.
The Asteco Qatar Q3 2013 report also revealed that on average, two-bedroom units in the Pearl Qatar development have increased 9 per cent compared to the second quarter. It now costs on average QR14,000 or upwards per month, closely followed by similar sized apartments in West Bay, which now command rents of up to QR12,000 per month, up 6 per cent over last year.
“Leasing rates have most notably increased in The Pearl Qatar, where availability will continue to be scarce until the completion of a number of new towers, currently under construction,” said Jed Wolfe, managing director, Asteco Qatar.
Availability of good quality villas is also limited, with rental increases apparent in most locations across Doha, said the report.
On average West Bay Lagoon is now the most expensive area to lease a four-bedroom villa at QR27,000 per month, up 16 per cent year-on-year, while Ain Khalid and Al Waab, saw annual increases of 18 per cent and 15 per cent respectively.
“The expatriate influx has also driven further demand for serviced apartments, where occupancy levels have increased from long-stay guests,” added Wolfe.
Increasing rents in the freehold zones has led to an increase in expatriate tenants looking to purchase and a resurgence in investor appetites. Direct and resale prices in the Porto Arabia-Pearl increased 7 per cent and 9 per cent respectively, while direct and resale values for properties in Viva-Bahriya-Pearl were up 6 per cent and 3 per cent.
“According to figures from the Ministry of Justice (MOJ), the number of sales transactions fell from Q3 2012, however the overall value of transactions increased, indicating an increase in average property values,” said Wolfe.
In the commercial sector, a significant number of property deals have been agreed for office buildings in West Bay, which will lead to a decrease in availability of prime office space in the area, potentially driving rents upwards for the remaining space available.
“The average price per square metre, per annum in West Bay is QR185, which is still 5 per cent lower than Q3 2012, but significantly, it is 9 per cent higher than Q2 2013,” said Wolfe.
Although evidence should suggest that most of the demand for office space is for smaller sized office suites in West Bay, in light of increasing occupancy levels, many landlords are reluctant to enter into negotiations with potential tenants unless these are considering taking up an entire or at least half a building, said the report.
Most of the remaining available office building space is either to shell and core standard, awaiting government interest, or below the standards required by most tenants, especially offices in secondary locations, it added.
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