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Tribune News Network
Doha
real estate cycle in Qatar is going to stabilise in the last quarter of this year, the Market Watch Office of SAK Holding Group said in a report.
Reports indicate positive shifts in the economy as a direct result of the success of alternative plans and strategies adopted by the state following the unjust blockade imposed on Qatar by neighbouring countries.
On June 5, the siege countries closed sea, air and land ports. The report pointed out that all of these and the diversification plans that Qatar had already embarked on have led to a qualitative shift in the country's basic economic structure, including the various sectors of the business environment.
Price correction trend
The report pointed out that owners of buildings should deal realistically with the real estate cycle and the trend of correction of prices and rents in order to accommodate the challenges of the market and reduce the risk of imbalances in the yields of real estate investment in general, and property prices, and volume of transactions.
The report added that any attempt to read the real estate market and determine its direction in the short term will be inaccurate and unfair, and the market is likely to maintain the average rental prices and real estate in the sale or purchase during the third quarter of this year.
Construction sector
The initiative of the private sector to deal with the crisis has contributed to the government efforts to thwart the objectives of the siege countries aimed at strangling Qatar economically, damaging its trade and economic security, curbing its development and development plans, and obstructing infrastructure projects and major strategic projects.
The report pointed out that the construction sector has continued its activity at a normal pace. It is certain that all projects will reach the stage of completion and delivery without any delay, including major strategic development projects and other infrastructure and development projects, especially those related to the World Cup and Qatar National Vision 2030. It should be clear to the embargo states that one of the most important objectives behind their actions and the abhorrent and unfair action against Qatar has failed, and that it did not and will not succeed in impeding the comprehensive development process. The blockade become an opportunity to launch a package of plans, strategies and alternative mechanisms that support Qatar's economic strength and independence.
Liquidity boost
In contrast to the expectations of the siege countries, Qatar has enhanced liquidity in the construction sector and increased the major public investments.
It has also injected funds to ensure the continuation of work on infrastructure projects, residential and industrial cities, major projects, and transportation projects such as Qatar Railways.
The government's interest in the real estate sector stems from its numerous contributions to the growth of various sectors and the development of the Qatari economy in general.
It has also contributed significantly to the growth of the financial sector and to the reduction of inflation. It has a vital role in the expansion plans of Qatar National Vision 2030 and preparations for hosting the 2022 World Cup.
Development projects
The report pointed out that the Qatari government continues to finance a wide range of development projects estimated to exceed $25 billion, including more than 250 infrastructure and transport development projects and World Cup projects. In this way, Qatar has provided real opportunities to the private sector and the local market, which benefited from the tenders aimed at upgrading and developing national companies.
In addition, the volume of government spending, which supported the growth of the economy and created valuable opportunities for local companies, especially small and medium-sized companies, pushed them to develop and gain new experiences in many basic and marginal activities resulting from various government projects.
State spending
Qatar's spending on development projects is expected to rise in new budget. The International Monetary Fund (IMF) is looking at it with great optimism, which could place Qatar at the forefront of development in the Middle East and North Africa region.
The report of the International Monetary Fund (IMF) recently revealed an increase in the growth rate in Qatar resulting from the growth of the non-oil sector. Qatar topped this year the list of countries having reduced the state budget deficit, thanks to the measures taken by the government, which led to an improvement in the balance of trade. The International Monetary Fund (IMF) report predicted the continuation of this improvement in 2018 and predicted a surge in revenues that would further reduce the budget deficit.
Qatar realty sector strong
The report said that the real estate sector is at the forefront of sectors that derive strength and stability from the strength, stability and resilience of the Qatari economy.
The report pointed to the positive ratings sovereign high credit enjoyed by Qatar, which surpasses the embargo countries. Qatar has high sovereign credit ratings that outperform the embargo countries. According to Fitch Ratings, it was rated AAA, and has an AA-degree from S & P International, and an AA3 from Moody's.
This reflects a high level of credit worthiness and very limited risk, and falls within the list of AA classifications.
According to press reports, the international rating agency AM Best reported that Qatar has low economic risk because it has large reserves of natural gas and remains one of the largest exporters of natural gas in the world and ranks third on the list of natural gas reserves in the world after Iran and Russia.
Qatari capital market in top ten rankings
In the same context, the monthly report pointed out that the Global Competitiveness Report 2017-2018 issued by the World Economic Conference held recently in Malaysia pointed out that the Qatari capital market is among the top ten financial markets in the world according to several indicators of measuring the performance of the capital market. The best and most important financial market in the Arab region, Qatar is one of the least expensive financial markets in terms of financial services provided to investors.
The monthly report pointed out that the market saw a reduction in rent values in vital projects in order to support and stimulate the market in the next phase.
He pointed out to reports indicating Barwa Real Estate's intention to reduce and stabilize the rental value in Al-Mawatir.
In order to encourage investors to expand and reserve more space to carry out their activities, a number of exhibitions were held and 30 such events were held in the first phase. A large number of contracts were signed at these exhibitions.
The report added that the cumulative qualitative growth during the last decade has strengthened Qatar's economy, giving its real estate the sustainability and ability to keep up with the country's development vision.
According to Qatar Central Bank, real estate prices in the country have risen by over 262 percent in 11 years as they have kept pace with the record growth in the national economy as well as the demographic growth. This has enabled the real estate market to maintain its appeal for the real estate investors.
As per the Central Bank's latest figures, based on information obtained from the Ministry of Justice, the real estate price index is up from 70.07 points in June 2016, to 256.03 points in September 2017.
Qatar Central Bank regularly monitors developments in this sector. The real estate price index is one of the measures used to assess developments in this sector. The index is calculated on the basis of the changes in the prices of land, villas, and apartments.
