In its latest economic brief on the monthly statistics of registered real estate contracts issued by the Ministry of Justice (MoJ), excluding sales conducted through agents, National Bank of Kuwait reports that the value of real estate sales increased slightly in April. A total of KD 96.7 million worth of transactions was registered, up by 8% from March. Year on year, sales fell by 42.6% in number and by 53% value. NBK notes that the rise in the value of sales was led by the commercial sector, which surged by 51%. Sales of apartments also rose by 13%, while residential sales dropped by 8%.
More detailed data from the Ministry of Justice (MoJ, not shown in the tables) reveal that more than half of all residential sector transactions were accounted for by sales of existing homes, rather than new plots. Meanwhile, two areas that are among the most active markets for privately held vacant plots, Abu Futaira and Ishbilya, both represented 58% of the total traded vacant residential plots. Despite the fact that these areas are relatively far from Kuwait City, there has been an increased interest in them, perhaps due to the completion of infrastructure.
NBK reported that real estate sales have fallen significantly thus far in 2009, with the average value of sales during the first four months of the year 56% lower than the same period last year. The number of transactions was also 54% lower. Most of the decline in sales during the period occurred in residential property with their sales values and transactions down by 62% and 63%, respectively.
The apartments sector was also weaker, with the average of monthly sales values dropping by 62%. Meanwhile, the average transaction size rose 19.7% for commercial property, but declined by 57% for apartments.
According to NBK, the number of Savings and Credit Bank (SCB) loans approved increased moderately by 2% to 460 in April over March, though the value of loans approved by the bank was down by 10.7%. Compared with March, approved loans for purchasing existing homes rose sharply, with number and value increasing by 84% and 146%, respectively. This increase is consistent with MoJ data showing a jump in purchases of existing homes during the month. Approved loans during the first four months of 2009 were up 158% in value and 43% in number compared with the same period last year.
Meanwhile, the SCB disbursed KD 15 million in loans during April, 4% more than the previous month, though the year-to-date average was up by 12% compared to a year before.
