ASK Real Estate report says Bahrain is witnessing a renewed Era of Growth

TDT | Manama                                                      

The Daily Tribune – www.newsofbahrain.com

A recent report by ASK Real Estate said that Bahrain’s real estate sector is witnessing a renewed era of growth and development supported by a strong vibrancy in construction activities.

The recent report covering the fourth quarter of 2023 said that Bahrain’s property market has continued to show resilience and ability to adapt to the global economic changes and regional geopolitical challenges.

Analysis suggests that the real estate sector in Bahrain is shifting towards more affordable properties.

The report mentioned that the revving of the construction sector in Bahrain is due to several factors, including high oil prices which boosted the whole economy.

Additionally, government interventions have played a crucial role in stimulating the property market, creating an environment conducive to both the continuation of existing projects and the initiation of new ones.

It also noted that the recently released real estate transaction data for Bahrain for the period 2021, 2022, and 2023 presents a nuanced picture of market dynamics. Over the three years, the total number of transactions increased from 21,444 in 2021 to 26,121 in 2023, signifying a notable growth of circa 21.8%.

However, the average transaction value experienced a decline from BD 48,786 in 2021 to BD 41,119 in 2023, indicating a shift in the market's appetite towards lower-value transactions.

This decline in total value, coupled with an increase in transaction volume, suggests a potential shift towards more affordable properties or increased activity in the lower end of the real estate market. Karim Yazji, the CEO at ASK Real Estate said, “The increased demand for the new government financing schemes has resulted in a higher number of transactions in affordable properties.

This confirms the government's keenness to provide suitable solutions to meet the housing needs.

We expect this momentum of activity to continue through 2024 as well.” The report has covered various activities related to the real estate sector.

It said that F&B is driving footfall in retail developments which boosted its occupancy. Prime retail developments were operating at near full capacity in Q4 of 2023 and for the greater part of 2023, as the footfall remained high.

The retail properties sector is expected to remain stable on the back of the growing population.

This will induce demand in the retail space. However, the sector faces several challenges such as the rise of e-commerce and competition from developed neighbouring countries such as UAE and Saudi Arabia.

It mentioned that inflation in most countries has led to increases in interest rates and subsequently higher borrowing costs for real estate buyers. However, world headline inflation is expected to decelerate.

Growth is still expected to slow in the Middle East and North Africa to reach 4.2% in 2024 driven by lower oil production and tight policy in emerging markets.