Oman real estate markets get investors salivating
The property market in Oman has seen strong peaks and troughs in recent years, but the future has never looked brighter, says one of the country's experts in property investment. According to Chris Steel, managing partner of Savills Oman, there has never been a better time to get into the market. The rationale behind this is simple: properties are starting to show owners net investment returns above the prevailing bank interest rates.
Combined with high levels of liquidity in the populace and favourable borrowing costs, the market has very much bucked the international trend, he says. In the capital area, the residential leasing sector has long been a favoured medium with stand-alone property showing returns of over five per cent. With the large percentage of expats only being able to rent, many landlord investors have built impressive investment portfolios over the last 30 years.
Chris Steel has watched the relatively new avenue of investing in ITCs (Integrated Tourism Complexes) open up and with demand far outstripping supply, it is a growth that is likely to continue for many years to come. "Original investors at developments such as The Wave, Muscat and Muscat Hills took calculated risks when buying. The gamble paid off and there is now an acute supply shortage at these developments, especially villas that can be leased quickly.
In some instances, there are waiting lists from renters for particular property types and landlords are seeing no rental void periods at all between tenant changes. With owner investors achieving high yield returns, it is no wonder that there is virtually no property for re sale in those developments." Savills Oman is the exclusive agent for Badr Muscat Hills. "The developers of Badr at Muscat Hills have been acutely wise in how they approached the project.
They analysed the target market of both owner-occupier and tenants wanted from the properties and then provided them. Initial rental returns are likely to be in excess of seven per cent with further growth likely over the shorter term as rental rates increase."
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