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Regional Statistics

The amazing Qatari boom - housing prices continue to surge

Property prices in Qatar continue to rise rapidly. The nationwide real estate price index soared by 23.2% during the year to Q2 2015, according to the Qatar Central Bank (QCB). During the latest quarter real estate prices rose by 4.7% (Q2 2015), supported by rapid economic and population growth, and a construction boom in preparation for the 2022 FIFA World Cup.

The value of real estate transactions rose by 18% y-o-y to QAR36 billion (US$9.8 billion) in the first half of 2015, and has almost tripled over the last five years.

At the Porto-Arabia Pearl. the first phase of The Pearl-Qatar, which has a total of 31 towers:

• In the primary market, the average apartment sales price rose by 7% to QAR17,000 (US$4,669) per sq. m. in Q3 2015 from the same period two years ago, according to real estate firm DTZ Qatar .
• In the secondary market, apartments were sold for up to QAR15,000 (US$4,120) in Q3 2015, up by about 15% from two years ago.

“Prices have continued to rise in The Pearl-Qatar, especially for most studio, one and two-bedroom units,” says Dan Strutt of real estate agency LS. “It is a city in itself and being a freehold zone, it is a lifestyle location,” added Strutt. Residential properties in The Pearl-Qatar now sell for more than QAR10,000 (US$2,747) per sq. m.

Even prices of affordable housing are rising rapidly. In Barwa City. house prices rose by 46% y-o-y during the first half of 2015, according to local daily The Peninsula.

There has also been a significant rise in mortgage valuation applications, fuelled by expatriate homebuyers in freehold areas. Real estate loans rose by 10.8% y-o-y to March 2015 to QAR94.32 billion (US$25.91 billion), according to the QCB.

In 2009 housing prices in Qatar fell by as much as 40%, while residential rents dropped about 25%, due to the global financial meltdown. according to Century 21 Qatar. Then in 2010, housing prices fell again by about 4%, according to Saudi-based banking firm, Samba Financial Group.

Prices started to stabilize in 2011, thanks to spectacular economic growth. From 2012 to 2014, the property market expanded strongly, mainly due to rapid population growth caused by the steady job growth in non-hydrocarbon sectors such as finance, hotels, restaurants, and trade and transport. The country’s population reached 2.37 million in May 2015, up by 9.2% from the same period last year, reflecting the large influx of expatriates.

Qatar issues permanent residence visas to foreigners buying freehold properties, under Law No. 17 of 2004, which permitted foreign freehold property ownership for the first time. A property boom followed from mid-2000s to early-2008.  Three areas have been set aside for the visas-for-sale scheme: the Pearl-Qatar, West Bay Lagoon and Al Khor Resort.

The visa remains valid as long as the foreigner keeps the property in his name. Foreigners and expatriate residents account for about three-fourths of the population, according to the Qatar Statistics Authority (QSA). About 82% of the population lives in Doha and Al Rayyan.

“With Qatar’s population growth set to increase by over 7 percent per annum in the coming years, the real estate market will need to expand more quickly to keep pace and avoid overheating the market,” said Johnny Archer of DTZ Qatar. GDP growth is expected to rise at 6.5% per year for the next two years, with a continuous influx of expatriate workers.