Qatar’s property market may see a correction this year after a ‘lucrative 2022’: ValuStrat Gulf Business News

Demand for real estate is unlikely to increase as much as supply in Qatar this year, so market corrections are likely to be widespread across all real estate sectors in 2023, according to consultancy group ValuStrat.
However, Qatar’s property market had a “rewarding” year despite a global slowdown in 2022, it said in a report.
There has been a significant increase in supply in the residential market with the addition of at least 13,000 units, which have mainly been concentrated in Al Wukair, Lusail and The Pearl, ValuStrat said. The largest project launched was a master plan named Madinatna, in Al Wukair, to be developed by Barwa Real Estate, comprising 6,780 apartments and 20,000 m² of commercial space.
Excess supply was exceeded by growth in demand resulting from “Eskan leases” and a temporary increase in population. As a result, residential rents have increased by around 15% per year. While house rents have increased substantially, residential sales have stabilized; the ValuStrat price index recorded marginal declines during the first half of 2022.
The retail market has experienced significant growth in terms of supply. This includes the opening of a super-regional mall in Lusail, Place Vendôme and regional and community malls in The Pearl, Msheireb and Lusail.
In addition, new street stores were delivered including on Lusail Boulevard, West Bay Beach, Qetaifan North Island and Al Maha Island.
As a result, an increase in retail demand has been supported by the opening of new brands and the expansion of existing brands in malls and street retail in Qatar.
However, in the third quarter of 2022, there was downward pressure on rents, with supply exceeding demand.
Pawel Banach, Managing Director of ValuStrat Qatar, said: “2022 has been a transformational year for Qatar with a huge influx of offers across all sectors. In the second half of 2022, we saw the opening of no less than 40 hotel projects and the addition of more than 10,000 residential units. . Market conditions should have exerted downward pressure on rents. However, due to the staging of the 2022 FIFA World Cup, there has been an upward movement in prices and rents across all sectors.”
The International Monetary Fund (IMF) has forecast Qatar’s real GDP to grow by 2.4% in 2023, even as it expects a third of the world to slip into recession amid the conflict in Ukraine. Additionally, the demand for Qatari gas continues to rise and the economy should benefit from their ongoing major investments in energy infrastructure.
Therefore, Qatar’s fiscal surplus is expected to reach QR 70.3 billion in 2023 (oil price assumed at $55 per barrel).
Anum Hasan, Head of ValuStrat Qatar (Research), commented: “From a macroeconomic perspective, Qatar has a positive economic outlook for 2023. However, in the context of the real estate sector, the market will face the huge influx of supply. in 2022 resulting from the hosting of the 2022 FIFA World Cup. Demand is not expected to increase as much as supply, so market corrections are expected to be widespread across all real estate sectors in 2023. »