With the initial euphoria of Qatar’s successful bid for the 2022 FIFA World Cup now fading, signs that the real estate market is continuing to stabilise have become more evident in Q1 2011, according to the latest research data from Asteco property management.
The Asteco Qatar Report Q1 2011 revealed that the stabilisation that was clearly apparent in Q4 2010 had continued, with quality being the defining factor on rates. Better-than-average apartments rose marginally, while rental rates for poorer quality apartments dropped slightly, with tenants focusing on affordable quality units. The rental rate for a one bedroom apartment in Al Saad is now QAR 4,750, a decrease of just QAR 125 per annum.
Demand for apartments in The Pearl-Qatar increased noticeably since last year, but with even greater supply coming online, rental rates actually declined. However, rental rates are still twice those of Al Saad, at QAR 9,750 for a one bedroom apartment. In general, rental rates for villas showed little change, the only noticeable movement was in Al Hilal, where entry rates dropped quarter-on-quarter from QAR 10,500 to QAR 9,500.
Elaine Jones, CEO of Asteco Property Management, said: “The Qatar government continues to drive the development of major projects within Doha and across other smaller cities in accordance with the 2022 FIFA winning bid and the wider ‘2030 Vision’, which will change the landscape of the real estate market in Qatar. Furthermore, the arrival of new work forces and managers to complete these projects will have a positive impact on the residential and office market.”
On the whole, residential sales remained stable, although, Asteco recorded a ‘widening’ of prices at the Pearl-Qatar – the peninsula state’s only freehold residential development. This mark of maturity, is supported by purchasers placing greater emphasis on quality and more importantly, being prepared to pay a premium for the distinction.
As a consequence, poorer quality apartments suffered minimal declines whilst better quality recorded slight increases. However the report stated that it was too early to ascertain if this trend would continue. Currently prices vary between QAR 9,500 per square metre for secondary market apartments in Lagoon Plaza to QAR 15,500 per square metre in Viva Bahriya-Pearl.
Meanwhile, there has been a marginal increase in demand for commercial office space, particularly for smaller office suites. However, rental rates continued to be subdued, with additional new and second-hand stock coming on to the market. Indeed, it is estimated that 30 high-rise office projects are in development within the Central Business District (CBD) alone.