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Qatar’s new property laws boost residential investments

Qatar’s new property laws boost residential investments

Tribune News Network
Doha
Recent amendments to real estate ownership laws have boosted residential investment sales, particularly in Lusail, with freehold interests in property now available for non-Qataris to purchase, according to Cushman and Wakefield Qatar (CWQ).
Law No.16 of 2018 provides expatriate property owners with the permanent residency card privileges for property investment above QR3,650,000 and the benefit of a residency permit without a sponsor for owners of real estate worth more than QR730,000.
According to the report, reviewing the fourth quarter real estate market in Qatar, residential sales continue to dominate the real estate market in Q1. Vacant land plots accounting for 53% of sales activity, while private residences account for 40% of transactions.
In the residential leasing market, the impact of the FIFA World Cup, which will take place in Qatar in November and December of 2022, is already evident, the real estate report said.
The expected increase in demand next year, underpinned by the proposed large-scale acquisition of apartments on government ‘Eskan’ leases, has led to a rise in the number of private tenants requesting two-year lease agreements, it added.
“The recent increase in new apartment supply, combined with the lack of expatriates moving to Qatar over the past 12 months has resulted in added value to residential tenants. Tenants increasingly insist on rental terms that are inclusive of utility bills, while the standards of internal furnishing and fittings are also improving to attract occupiers.”
There has been a general shift in residential demand towards a higher quality product, the report said.
“This is partly due to residents increasing their rental budgets, as COVID-19 lockdown measures have enforced changes in spending patterns. Increasing demand at the high end of the market has seen areas such as West Bay Lagoon reach their highest level of occupancy since 2015. There has also been evidence of small rental increases in some apartment types in The Pearl-Qatar.”
Semi-furnished, one-bedroom apartments in Porto Arabia typically command rents of between QR 7,000 – QR8,000, while equivalent apartments in Bin Mahmoud are now typically leasing for between QR4,000 and QR4,500 per month, it said.
The shift in demand towards higher quality accommodation has seen an increase in the development of fully furnished, serviced apartments, particularly in older districts close to central Doha.
Serviced apartments in new high-specification buildings can command rental premiums of 50% - 80% above semi-furnished units, although development costs and operating expenses are also considerably higher.
In the retail market, new demand for retail space remains low due to the ongoing lockdown measures Following the lifting of most COVID-related restrictions in Q4, the retail sector performed relatively well in Doha in the early months of 2021; however, following an increase in cases throughout March, it is anticipated that the government may re-introduce some restrictions in April.
While footfall increased in Qatar’s retail malls in Q1, uncertainty about the duration of lockdown measures from country to country and the accelerating global trend towards online shopping means that many international retail chains have put real-estate acquisition plans on hold over the past 12 months.
This is mainly affecting take-up in retail malls, with vacancy rates increasing in recent months. While many of Qatar’s malls continue to perform well, C&W estimate that overall occupancy rates for organised retail have fallen to approximately 80%.
Overall supply in Doha’s 20 largest organised retail malls now totals over 1.3 million sq m following the recent opening of the Galleria at Msheireb. The total leasable area of organised retail accommodation throughout Qatar, including neighbourhood malls, has now surpassed 1.5 million sq m.
In addition to organised retail malls, outdoor destinations including Souq Waqif, Katara Cultural Village, Medina Centrale, and La Croisette provide more than 230,000 sq m of leasable space.
Rents for ‘in-line’ retail stores in Doha’s main organised malls typically range from QAR 200 to QAR 320 per sq m month.
Lower rents are available to anchor stores and larger outlets.

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