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Kuwait real estate sales soar to $660m in November

KUWAIT, December 27, 2016

Kuwait's real estate market received a significant boost from the commercial sector in November, pushing the monthly sales above KD200 million ($660 million) for the first time in six months, according to a report.

However, the activity and sales value of the residential and investment sectors continued to lag last year’s performance by 22 per cent year-on-year (y/y) each, stated National Bank of Kuwait (NBK) in its report.

Sales in all sectors totalled KD2.04 billion ($6.73 billion) year-to-date (ytd), down 27 per cent y/y, it said.

November’s price performance, as reflected in NBK’s real estate price indices, indicates some stabilisation and convergence of trends across sectors.

Notwithstanding the occasional strong month, the residential sector sales have been generally weak throughout 2016. Sector sales totaled KD71.4 million on 244 transactions during the month, stated the report.

According to NBK, the sales and transactions were both down 25 per cent and 21 per cent y/y, respectively. The softness in this sector is congruent with the slowdown in installment loans and bank credit to the real estate sector, it said.

Residential real estate prices have come down from peaks and lay close to 2013 averages, it added.

The NBK residential home price index stood at 152.5, retreating by 12 per cent y/y. The index has been trending downward since the beginning of 2015, when it peaked at 186 in January 2015; it is down 18 per cent from its January peak.

Meanwhile, the residential land price index inched slightly upward in November to 178.2, though it remains down 9.5 per cent y/y and 13 per cent below its peak in March 2014, said Kuwait's top lender in its report .

NBK pointed out that the investment sector sales this November remained relatively subdued. Sales totaled KD57.9 million, down 1 per cent month-on-month (m/m), in 112 transactions.

The sector’s activity throughout the last two months has been generally soft, reminding us of the summer lull, despite the pickup in investment building sales, said the report.  

The investment building price index retreated marginally in November, erasing the previous month gain. The NBK investment building price index shed four points this month to 180.5, and remained down 13 per cent y/y.

According to NBK, the commercial sector provided the only support for the real estate market this month. Sales soared to KD82.5 million, the second highest performance this year.

Year-to-date sales were up five per cent from the same period last year, it stated.

This was based on only nine transactions; the largest transactions recorded were two commercial plots in Sabah Al Ahmad Sea City for KD20.3 million and a commercial plot in Salmiya for KD 2.6 million, it added.-TradeArabia News Service




Tags: Kuwait | real estate | Sales |

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