DTZ Quarterly Report Qatar Q4 2017: Residential Market Report - Apartments and Villas For Rent In Qatar - DTZ

Press Releases

February 7, 2018

DTZ Quarterly Report Qatar Q4 2017: Residential Market Report

fig1 resi

Strong rental growth experienced between 2011 and 2015 has been reversed over the past 24 months due to a combination of factors. Demand for apartments and villas has been affected by the economic downturn – resulting from the fall in hydrocarbon prices – and has been compounded by recent economic blockade. Reduced demand has coincided with the completion of major residential projects, which has seen supply grow substantially.

 
Residential demand in Qatar has been driven by population growth, which exceeded 7% per annum in recent years, however population has levelled off through 2017. In November the population was recorded at 2,682,596, which reflected a year on year increase of less than 2%. Anecdotal evidence suggests that the increase in population is largely accounted for by construction workers, due to the acceleration of the government’s spending on infrastructure projects. In real terms, DTZ note that there has been a reduction in demand from tenants looking to acquire villa and apartment accommodation throughout 2017.

 
The increase in supply and reduced demand has resulted in a fall in overall occupancy rates throughout 2017. While some developments retain high occupancy rates (often due to corporate leases), others have seen a sharp increase in vacancy in recent months. This has encouraged landlords to become more flexible in relation to rental levels and incentives. The result is that tenants are now increasingly willing to ‘shop around’ on the expiry of existing leases to take advantage of more advantageous lease terms.

 
The most significant residential development to influence the residential leasing market in 2017 is Ezdan Oasis, which opened in July. DTZ understands that Phase 1 has attracted significant interest from individual tenants and corporate occupiers looking for staff accommodation. Rental levels of QAR4,500 for a one bed apartment up to QAR6,500 for a three-bedroom have set a benchmark for newly built mid-market apartments on the outskirts of Doha.

fig2 resi
In the prime residential sector, while some developments retain strong rents and occupancy rates, quoted rents for vacant units have typically fallen by between 10% and 15% in the past year. Most two-bedroom apartments in West Bay or The Pearl Qatar are now available to lease for between QAR11,000 and QAR13,000 per month.

fig3 resi
Sales prices have also been falling over the past year, with purchasers looking to take advantage of the weaker market conditions. Second hand apartment sales in Porto Arabia are now typically transacting at prices between QAR11,000 and QAR12,500 per square metre.

For more insight and further information on Qatar’s residential market, please click the link below to download the full report.

DTZ Quarterly Report Qatar Q4 2017

To find a property for lease in Doha, please click here to start your property search.