Real estate transactions decline by 21.1% in Kuwait

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KUWAIT CITY, April 22: The Kuwait Finance House (KFH) report revealed that real estate transactions in 2023 amounted to 3.1 billion dinars (contracts and agencies), marking a 21.1% decrease from the previous year, reports Al-Qabas daily. This decline was primarily driven by reduced transactions in private housing, which amounted to approximately 1.45 billion dinars, down by 27.2% compared to the previous year, representing 47.1% of total transactions. Investment real estate transactions also decreased to 906 million dinars, a drop of 18.8%, constituting 29.2% of total trades.

Meanwhile, commercial real estate transactions recorded 514 million dinars, down by 15%, making up approximately 16.5% of total transactions. The craft sector, trade fairs, and industrial plots witnessed a significant decline to about 84 million dinars, a decrease of 51.8% from 2022. However, the coastal strip sector saw a notable increase, reaching 140 million dinars, more than four times its value in 2022, contributing 4.5% to total transactions. The report also noted a decline in real estate demand in 2023, evidenced by a 28.5% decrease in the number of deals, totaling 4,443 deals. This decline was observed across various sectors, except for the coastal strip, which experienced an increase. However, the coastal strip’s contribution to total transactions remained minimal.

Private housing transactions decreased to 3,114 deals, down by 31.5% from the previous year, while investment deals reached 1,149, a decrease of 17.3%. Commercial sector deals totaled 118, down by 26.7% compared to 2022. Private housing prices saw a modest decline of 1% by the end of the fourth quarter of 2023, marking the second annual decline in five years. Investment real estate prices increased by 1%, while commercial real estate prices rose by 2.8% in the same period. Chalet area prices remained stable, while creek area prices experienced slight decreases. Residential area prices varied across regions, with declines observed in some areas of the Capital and Hawalli governorates.

The average price per square meter of ownership for apartments in investment properties remained stable across most governorates, while rental values increased slightly by 1.7% annually. The average rental value for private housing saw a minor decrease of 0.2% annually. In the Capital Governorate, the average price per square meter for private housing decreased to 1,408 dinars, while investment real estate reached 2,397 dinars. In Hawalli Governorate, private housing prices declined to 1,167 dinars, while investment real estate increased to 1,685 dinars. Farwaniya Governorate saw private housing prices at 775 dinars on average, with investment real estate reaching 1,500 dinars.

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