- Gulf state sees rise in property prices, transactions
According to Zawya’s article published on November 21, 2022, Bahrain’s real estate market has seen growth on the back of rising business confidence and strong oil prices.
According to Knight Frank’s Bahrain real estate market review, the kingdom’s Vision 2030 has contributed to business confidence, along with the $30 billion set aside for real estate projects across all sectors.
The number of transactions in Bahrain’s residential market posted a 3.2% per cent increase from H1 2021 to H1 2022. Apartment prices rose 4.3% year-on-year, while villa prices went up 4.5%.
Faisal Durrani, partner, head of Middle East research, said that with more than 45,000 new homes planned around the country, “yields may start to move out once more, should demand not be able to keep pace with the upcoming supply”.
“The current challenge to the residential market’s upward trajectory will, of course, be rising base rates and the impact on mortgaged buyers,” he said.
Knight Frank said Bahrain’s office rents are also starting to rise slowly as business confidence “beds in”.
Stephen Flanagan, partner, head of valuation and advisory, MENA, noted that based on anecdotal evidence, “organisations that implemented hybrid working arrangements are now returning to full occupancy, driving up demand”.
“Bahrain's business environment continues to improve, with new labour laws designed to protect workers as well as employers’ rights aiding business confidence.”
He noted that, while lease rates remain relatively low, especially when compared to other Middle East hub cities, they have edged up by 1.6% this quarter to an average of BD 63 per square metre ($167.55).
Among the locations, Bahrain Financial Harbour has retained its position as the most expensive place to rent an office in Manama at BD 72 per square metre.
