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Residential sector upbeat with rising projects

Doha, Qatar: Qatar’s housing market is witnessing a positive momentum with numerous projects lined up since the first quarter of the year.

According to ValuStrat, approximately 1,200 units were added increasing the residential stock to 336,440 units during Q1 2023. These units consist of nearly 42 percent villas and 58 percent apartments.

Some of the notable projects that were implemented include The Grand Zone at the Mall of Qatar, which now has 1,023 apartments, Al Darwish Residential Tower in West Bay with 160 apartments, and a residential building consisting of 150 apartments in the Waterfront District of Lusail city.

Meanwhile, the sales for La Mer Villas contain 71 units in Qetaifan Island North and Blossom Residential Tower with 112 apartments in Al Erkhyah Lusail were launched.

The report states that it is estimated to carry out projects in the residential industry with about 11,700 units in the pipeline this year, of which 52 percent will be established in Lusail and The Pearl.

ValuStrat remarked that the volume of transactions surged significantly by 9.6 percent Quarter-on-Quarter but shows a decrease of 36.4 percent as compared to Q1 2022.

The median ticket size for residential units was QR2.8m, showing a quarterly decline of 1.8 percent, however, it still is a yearly increase of 7.6 percent.

Areas such as Al Khor, Muaither, and Umm Karn had the highest volume of transactions of residential houses during the first quarter of the year.

While the projects continued to impact positively post-FIFA, 43 transactions were completed for residential units in areas including Old Airport, Fereej Abdul Aziz, and Al Mansoura comprising the majority of the transaction volume.

The report, however, mentions that the volume and value of transactions in both The Pearl Qatar and Al Qassar fell by 30 percent and 17 percent year-on-year during the first three months of the year.

The median asking residential rent dropped steeply by 5.1 percent quarterly to QR9,250 but shows an increase of 3 percent as compared to the listed rent in the same period in 2022.

ValuStrat notes that the apartment sub-market continued to experience market corrections, and the median asking rent declined by 5.4 percent Quarter on Quarter.

However, the average quoted rents for apartments in financial districts like Lusail and West Bay experienced the highest quarterly depreciation of 8 percent and 9 percent, respectively.

Albeit the asking rents for apartments in Lusail, West Bay and The Pearl depreciated quarterly, median rents in these areas are still 11 percent higher on average compared to the first quarter of 2022

The report points out that the average listed rents of villas in Al Muraikh, Al Wakrah and Abu Hamour rose to 4 percent Quarter on Quarter.

As the mega sporting event, FIFA World Cup Qatar 2022 concluded last year, short-term Eskan lease contracts were expired, which resulted in the increasing rates of vacancies in the country in the residential sector.

For a detailed perspective on the property market, visit: Qatar - Real Estate Review Q1 2023