Kuwait real estate sales hit $11bn in 2012
Kuwait, February 10, 2013
Kuwaiti real estate sales registered a solid 16 per cent growth in 2012 to hit KD3.1 billion ($10.9 billion) compared to KD2.7 billion the previous year, indicating a generally healthy year, said a report.
The property sales more than doubled to KD363 million ($978 million) in December following a solid performance by all three major segments - residential, investment and commercial - after some slowdown in the past few months, according to country's top lender National Bank of Kuwait (NBK).
Similar to November, the large year-on-year increase was a result of strong sales in all three major real estate segments, said the NBK report.
The sales in the residential sector surged to KD204 million in December, rising by a sizable KD117 million y/y. The jump in sales came from a higher number of transactions, especially for plots of land, it stated.
The total number of all residential transactions in December rose by 73 per cent y/y, the report added.
According to NBK, the three-month average (October – December) price for residential plots recorded KD333 per sq m, while the comparable price for residential homes were KD632/sq m.
These prices are aggregated across different governorates, as well as different specifications, and therefore only serve as a general indicator, said the report.
"As for the full year, the aggregate sales in the sector rose 20 per cent y/y to hit KD1.7 billion and averaging 657 transactions per month, compared to a 494 average in 2011. These figures indicate a healthy sector, backed by persistent local demand," the NBK report added.
On the investment sector (mainly apartments and buildings intended for rental), NBK said the country witnessed sales worth KD116 million in December, KD55 million more than the last year.
The sector also saw a strong recovery in the fourth quarter, after some slowdown earlier in the year, the top Kuwaiti bank said in its report.
"In terms of pricing, the three-month average price for apartments was KD626/sq m for the October-December period, while whole buildings recorded KD1301/sq m. As for plots of land allotted to the investment sector, the price went up to KD1139/sq m," it added.
According to NBK, the country's sales in the investment segment totaled KD1.2 billion in 2012, up 16 per cent y/y. Both healthy demand and on-coming new supply should keep the sector in good shape for the near future, said the report.
The sales in the commercial sector totaled KD43 million, down from last month but more than double the monthly average for 2012.
About KD24 million came from the sale of three separate commercial buildings in Hawalli governorate, while most other transactions took place in Kuwait City, it stated.
This sector brought in KD252 million in sales in 2012, a 2 per cent increase from the previous year. However, the last two months of the year witnessed increased interest in the sector, said the top Kuwaiti bank.
"If this trend continues, alongside a more active government real estate fund, we could see a notable pick-up in sales in 2013,'" it stated.
In its review, NBK said overall, 2012 saw a more active real estate market compared to recent years.
"The residential segment continued to lead sales, grabbing 55 per cent of the total, while the investment segment took 37 per cent and generally appeared to be in good shape, posting y/y increases in 8 out of the 12 months," it revealed.
"The commercial sector somehow also managed to end the year on a positive note. Overall, we expect the positive trend in sales to continue in 2013, albeit with varying intensity among the three segments," the report stated.
NBK said the Savings and Credit Bank (SCB) had approved a little more than KD22 million in loans, spread out over 394 applications.
"About a third of those applications were for the construction of new homes. Additionally, the SCB disbursed KD 9.2 million in housing loans," it added.-TradeArabia News Service
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