A shortage of residential units in the market coupled with the increasing construction costs have caused a significant rise in house rents over the past six months, say industry sources.
Rents have gone up by 10 to 20 percent despite a presumed lull in recruitments by leading companies and corporations and a subsequent fall in the number of high-salaried professionals arriving in the country, say experts.
Most landlords are hiking the prices as they renew the tenancy contracts and the tenants have been forced to shell out, in the absence of cheaper alternatives in the market.
“There is a shortage of residential units and new projects are not coming up mainly due to a lull in allotment of lands,” Ahmed Al Arouqi, a real estate analyst told this daily yesterday.
“Land prices remain very high and there are no new allotments. No new areas have been earmarked for construction,” he added.
He said the increasing construction costs, especially the land price, has caused the rents to shoot up by at least 10 percent since the beginning of this year.
According to latest data, a square foot of land in central Doha cost as high as QR2075, while property prices have also gone up, with a one-bed flat in some areas in the city being sold at QR1m.
Many landlords are not willing to rent out their properties to individuals, which, he said, is an additional factor creating an artificial shortage.
“Everyone is looking for a single corporate customer to avoid dealing with many tenants,” said Al Arouqi. An expert working with a leading real estate company said that house rents have gone up by 10 to 20 percent since the middle of last year.
“Landlords are hiking rents mainly because of the rising construction and maintenance costs. Tenants are not moving out simply because it is nearly impossible to find a similar property at lesser rent,” he said.
He said a two-bed room flat that was available for QR6,000 last year now costs QR7,000 and rents for a two-bed room facility have also gone up in the same ratio.
“The market is static and we don’t find many new customers or those moving from one property to another,” he added.
He said the difficulties in getting school admission for children, especially in Indian schools, have deterred many expatriates from bringing their families to Qatar. There is also a presumed drop in the number of new professionals taking up jobs in major sectors like oil and gas.
“Any future surge in demand could worsen the shortage of residential units and jack up the prices further,” said the expert.
He said the high rents have now forced many expatriate families to share flats, as they did with villas, earlier.
“The practice of sharing villas still exist since the authorities have not implemented the ban on partitioning strictly, probably because they know that this could worsen the situation. It is also difficult to put cap on rent hike, due to the increasing construction costs,” he added.
If you have anything you want to share with us, send us an e-mail at [email protected]!
Want to send a tip? Drop us an e-mail at [email protected], anonymity is guaranteed!
You have successfully registered your account!Please confirm your e-mail address by clicking on the URL sent to you.The e-mail usually arrives in 5-10 minutes.
Salam! Welcome to our brand new site! Looking good huh?
New to ILQ? What are you waiting for? Sign up!